Spousal Property

A debtor that is married might offer various defenses based on the community property laws of the state of Texas.  This page discusses some of those issues.

A spouse’s separate property cannot be seized to satisfy a judgment against the other spouse unless both spouses are liable under other rule of law. Tex. Fam. Code § 3.202(a). Community property that is subject to one spouse’s sole management, control, and disposition is not subject to liabilities that the other spouse incurred before marriage or to a nontortious liability that the other spouse incurred during marriage, unless both spouses are personally liable under Code sections 3.201, 3.202, and 3.203. See Tex. Fam. Code § 3.202(b). A person is personally liable for the acts of the person’s spouse only if the spouse acts as agent for the person or the spouse incurs a debt for necessaries under section 2.501. See Tex. Fam. Code § 3.201(a). 

Except under Tex. Fam. Code § 3.202, community property is not subject to a liability that arises from an act of a spouse. A marriage relationship does not in and of itself create an agency relationship between spouses. Tex. Fam. Code § 3.201(b), (c). Sole-management community property is subject to liabilities incurred by that spouse before or during marriage, and joint-management community property is subject to the liabilities incurred by either spouse before or during marriage. Tex. Fam. Code § 3.202(b); Carlton v. Estate of Estes, 664 S.W.2d 322, 323 (Tex. 1983) (wife’s interest in joint-management community property was liable for debts of husband). But see Nelson v. Citizen’s Bank & Trust Co., 881 S.W.2d 128, 130–31 (Tex. App.—Beaumont 1994, no writ) (nonsigning spouse not personally liable for corporate debt guaranteed by other spouse). The plaintiff with a judgment against one spouse should therefore try to locate, in this order— 

1. that spouse’s separate property; 

2. community property subject to that spouse’s sole management, control, and disposition; 

3. community property subject to the other spouse’s control, if the conditions of Tex. Fam. Code § 3.201(a)(1) or (a)(2) are met; and 

4. joint-management community property. 

If the judgment is against both spouses for joint liability, all community property and both spouses’ separate property can be reached.  A specific item of property might be exempt under some other rule of law, such as the general personal property exemption statute. See Tex. Prop. Code § 42.002. See section 14.41:1 below. Tex. Fam. Code § 3.203 provides for judicial determination of the order in which property is subject to execution. 

Property possessed by either spouse during or on dissolution of marriage is presumed to be community property. Tex. Fam. Code § 3.003(a); see Panozzo v. Panozzo, 904 S.W.2d 780, 786 (Tex. App.—Corpus Christi 1995, no writ); Celso v. Celso, 864 S.W.2d 652, 654 (Tex. App.—Tyler 1993, no writ); Brooks v. Sherry Lane National Bank, 788 S.W.2d 874, 876 (Tex. App.—Dallas 1990, no writ). The degree of proof necessary to establish that property is separate property is clear and convincing evidence. Tex. Fam. Code § 3.003(b). Sole-management community property is that community property that the spouse would have owned if single, including but not limited to— 

1. personal earnings; 

2. separate-property revenues; 

3. personal injury recoveries; and 

4. increases of, mutations of, and revenues from his or her sole-management property. 


Tex. Fin. Code § 3.102(a). The spouses can agree in writing or by other agreement that other community property will be sole-management community property. Tex. Fin. Code § 3.102(c). An oral agreement falls within this provision. LeBlanc v. Waller, 603 S.W.2d 265, 267–68 (Tex. Civ. App.—Houston [14th Dist.] 1980, no writ). Unless otherwise provided, mixed community property is joint-management com-munity property. Tex. Fin. Code § 3.102(b). Community property not included in one of these exceptions is joint-management community property. Tex. Fin. Code § 3.102(c). 
Recently, the Texas legislature added sections to the Family Code discussing the classification of certain employee benefits and certain insurance proceeds. See Tex. Fam. Code §§ 3.007–.008.