The following is a guest blog article by the Law Office of Michael P. Granata
The question often comes up in a divorce as to what portion of any injury proceeds received during a marriage are the separate property of the injury spouse. Texas Case law gives guidance on what is and what is not separate property.
The general rule is that injury monies recovered for past, current and future pain and suffering are the separate property (and thus not divisible by the trial Court) of the injured spouse while monies paid for lost earnings, lost income, medical expenses paid by the community, and other expenses associated with the injury to the community estate are going to generally be characterized as community property money. Here are some tips to guide you:
Juries decide and apportion damages, so should settlement agreements: it makes a significant difference exactly what the injured person is being compensated for and therefore it’s important to properly identify what portion of the settlement/judgment is being used to compensate.
Community Estate is entitled to recover damages: damages that belong to the community estate include lost wages of the injured spouse, damages for medical expenses, and other expenses associated with the injury to the community estate.
Loss of Consortium: it’s possible the non-injured spouse may have a cause of action against a third party for injuries to the other spouse. This was the case in Osborn v. Osburn, 961 S.W.2d 408. Wife filed a lawsuit against a medical provider for loss of consortium after her husband was injured by the medical provider. The portion of the monies used to compensate her for her loss of consortium ended being her separate property because the injury was against her. The community wasn’t injured in any way.
It’s reversible error for a Trial Court to mischaracterize separate property as community property: the divorce Court is required to properly characterize damages by the personal injury lawsuit.
I hope this provides some clarification for individuals faced with this unique situation.
This post is by the Law Office of Michael Granata, P.C., a Dallas Divorce and Custody Law Firm.