1616 Tower Life Building San Antonio, Texas 78205 Tel: 210-225-5567 Fax: 210-267-7777 richard@momnd.com      Home      Resume      Hiring A Lawyer      Publications      Associate Attorneys      Articles      Common Questions      Email Richard

Economic Contribution Claims Texas law provides a remedy where community property is used to pay separate property debt or to make improvements to separate property real estate, or vice-versa. In many instances the use of funds from one marital estate to benefit another marital estate can create unjust enrichment, to be rectified at the time of divorce. For over 100 years, Texas appellate court opinions governed the rules relating to these sorts of claims between marital estates. The traditional remedy was called "marital property reimbursement." The rules for marital property reimbursement, developed over many decades in different appellate opinions, were varied, and some lawyers and judges considered them to be confusing and inconsistent. In a recent session, the Texas Legislature adopted a statute that replaced much of the case law on marital property reimbursement, and substituted a new statutory claim called an "economic contribution claim." The rules governing statutory economic contribution claims are much more specific than the rules governing the older case-derived marital property reimbursement claims they replaced. But because the statutory rules are so specific, they are sometimes extremely difficult to apply. The statute is so new, and there are so few appellate opinions telling us how the statutory rules affect different kinds of factual situations, that the knowledge and experience of the lawyer in handling such claims is extremely important. The details of economic contribution claims are stated elsewhere on this web site [to see them, click here]. Most written examples in legal articles that talk about the operation of this statute involve the payment of a mortgage on real estate using funds from another marital estate. Those issues are sometimes simple, sometimes more complex. However, an increasingly frequent problem is the application of economic contribution claim rules to stock brokerage accounts where one of the spouses has used margin debt to acquire stocks or bonds, or "puts" and "calls," or has sold stock "short,"or engaged in day trading on margin. In 2007, Mr. Orsinger was involved in a case with several thousands of brokerage transactions, including margin purchases, short sales, and day trading on margin. The way to fit these transactions into the economic contribution statute was a major part of the dispute. The case was settled without a trial, but the circumstances of that case underscore the challenges that can arise in a divorce where one spouse has used margin debt to trade in stocks, bonds, puts, calls, or has engaged in short sales, and the importance of having a lawyer with experience in these types of complexities. Board Certified in Family Law and Civil Appellate Law by the Texas Board of Legal Specialization. Read Disclaimer | Return to top