Alex Graves, award-winning director of “The West Wing” recently finalized his divorce from his wife of 19 years. Pursuant to the final order, the spouses’ property was divided evenly. Does the State of Texas mandate a fifty-fifty division of property upon divorce? The short answer is “no.” Continue Reading ›
This past November, an Oklahoma County Judge ordered billionaire oilman Harold Hamm to pay approximately $1 billion to Sue Ann Hamm, his wife of 26 years. Harold Hamm, who is the founder and CEO of Continental Resources, was specifically ordered to pay Sue Ann Hamm a total of $995.5 million, comprised of a lump sum payment of $320 million to be paid by the end of 2014, and the remainder to be paid via installments of at least $7 million per month.
If the Hamm divorce occurred in Texas, then the result might have been different. For one, Texas is a community property state; whereas, Oklahoma is an equitable distribution state. In Texas, all property existing at the time of divorce is presumed to be community property. To rebut the “community-property presumption,” a spouse must present clear and convincing evidence of the property’s separate character. Income from community property during marriage is generally considered community property, and under Texas law, once the character of property is established, that character will not change because of appreciation in the property’s value or because of mutations in the property’s form (for example, being exchanged or sold for other property). Texas Family Code, Chapter 3.
In Oklahoma, however, the money a spouse earns while married is considered “marital property” (property that can be divided upon divorce) if it is made through skill. On the other hand, if the money is attributable to “changing economic conditions, or circumstances beyond the parties’ control,” then that money is not considered marital property. If all of Mr. Hamm’s fortune was acquired by means other than by gift, devise or descent during the marriage, then a Texas trial court could have found that the assets comprising Mr. Hamm’s approximate $14 billion net worth were community property and made a ruling in conformity with such a finding (which likely would have resulted in a substantially greater sum than $1 billion being awarded to Sue Ann Hamm).