                                    NO. 07-05-0183-CV

                              IN THE COURT OF APPEALS

                       FOR THE SEVENTH DISTRICT OF TEXAS

                                       AT AMARILLO

                                         PANEL B

                                   APRIL 26, 2006
                          ______________________________

                     IN THE MATTER OF THE MARRIAGE OF
                  DEBBIE TARDY ROHLING AND FRED A. ROHLING
                      _________________________________

             FROM THE 72ND DISTRICT COURT OF LUBBOCK COUNTY;

             NO. 2004-528,058; HONORABLE DAVID GLEASON, JUDGE
                       _______________________________


Before QUINN, C.J., and CAMPBELL and HANCOCK, JJ.


                                MEMORANDUM OPINION


       Appellant, Debbie Tardy Rohling, appeals the trial court’s classification of property

and the award of reimbursement to appellee, Fred A. Rohling. We reverse and remand

to the trial court for further proceedings consistent with this opinion.


                                        Background


       Debbie and Fred were married on June 28, 2003. Prior to the wedding date, the

parties signed a premarital agreement that identified certain property as the parties’

separate property, and set out provisions for the division of community property upon the

dissolution of the marriage. At or near the wedding date, Fred purchased four items: a
1972 Chevrolet Chevelle, a Clark forklift, a 1991 Toyota Celica, and a 1982 Chevrolet

Blazer. During this same time period, Fred also sold his home and shop building, and

maintained the cash proceeds in an account as separate property.


      During the course of the marriage, the parties purchased community property

including a home and home furnishings. Additionally, the couple purchased a new shop

for which Fred paid approximately $10,000 as a down payment. After approximately fifteen

months of marriage, Debbie filed for divorce in October 2004 and the parties were divorced

on February 3, 2005.


      On appeal, Debbie raises three issues. Debbie contends that during the divorce

proceedings the trial court erred in (1) allowing two documents into evidence because the

documents were hearsay; (2) awarding Fred the four items purchased at or near the time

of the wedding because there was no evidence to support the characterization of the

property as Fred’s separate property or, in the alternative, such characterization was

contrary to the overwhelming weight of the evidence; and (3) awarding $15,000 to Fred as

economic contribution and reimbursement of his separate property for enhancement of the

community estate because such an award was contrary to the overwhelming weight of the

evidence.


                                  Admission of Evidence


       Evidentiary rulings admitting or excluding evidence are committed to the trial court's

sound discretion. See Texas Dep’t of Transp. v. Able, 35 S.W.3d 608, 617 (Tex. 2000);

City of Brownsville v. Alvarado, 897 S.W.2d 750, 753 (Tex. 1995). A trial court abuses its

                                             2
discretion when it acts without regard for any guiding rules or principles. Alvarado, 897

S.W.2d at 754. An appellate court must uphold the trial court's evidentiary ruling if there

is any legitimate basis for the ruling. Owens-Corning Fiberglas Corp. v. Malone, 972

S.W.2d 35, 43 (Tex. 1998). A case will not be reversed because of an erroneous

evidentiary ruling unless the error was harmful, that is, unless it probably caused the

rendition of an improper judgment. See TEX . R. APP. P. 44.1(a); see also Able, 35 S.W.3d

at 617; Malone, 972 S.W.2d at 43. A successful challenge to an evidentiary ruling usually

requires the complaining party to show that the judgment turns on the particular evidence

excluded or admitted. See Able, 35 S.W.3d at 617; Alvarado, 897 S.W.2d at 753-54.


       Debbie properly objected to the admission of two receipts related to the purchase

of the 1972 Chevrolet Chevelle and forklift as hearsay. See TEX . R. EVID . 103(a); TEX . R.

APP. P. 33.1. Fred did not raise before the trial court an exception to the hearsay rule, and

we find no applicable hearsay exception. See TEX . R. EVID . 803-804. Therefore, the trial

court failed to follow guiding rules and principles in overruling Debbie’s hearsay objection.

Without the receipts, Fred had no other written evidence supporting his contention that the

Chevelle and the forklift were his separate property. Thus, the admission of the receipts

was harmful and probably caused the rendition of an improper judgment, as we will further

elaborate in the next section.


                                 Characterization of Property


       Property possessed by either spouse on dissolution of marriage is presumed to be

community property and, to overcome this presumption, a party must establish by clear


                                              3
and convincing evidence that the disputed property is separate property. See TEX . FAM .

CODE ANN . § 3.003 (Vernon 1998).1 Clear and convincing evidence is defined as that

“measure or degree of proof which will produce in the mind of the trier of fact a firm belief

or conviction as to the truth of the allegations sought to be established.” § 101.007. Mere

testimony that property was purchased with separate property funds, without a tracing of

the funds, is generally insufficient to rebut the community presumption. Zagorski v.

Zagorski, 116 S.W.3d 309, 316 (Tex.App.–Houston [14th Dist.] 2003, pet. denied).


        Debbie contends that the four disputed items were purchased after marriage and

are, thus, community property. In contrast, Fred testified that the vehicles and forklift were

purchased prior to marriage and are, thus, separate property. Considering that the only

written evidence concerning the chararcterization of this property were the two receipts that

we have determined were erroneously admitted, the only remaining evidence of the

property’s characterization was the testimony of the parties. We conclude that Fred’s mere

testimony that the property was purchased with separate property funds, without tracing

of the funds, was insufficient to rebut the community presumption. Zagorski, 116 S.W.3d

at 316. Therefore, Fred failed to overcome the community presumption as to each of the

four items found by the trial court to have been Fred’s separate property. Since Fred failed

to present any tracing evidence to overcome the community presumption, the trial court

could not have formed a firm belief or conviction that the items were Fred’s separate

property. Therefore, we conclude that the trial court erred in characterizing the forklift,



        1
            Further reference to sections of the Texas Family Code will be by reference to “§
___.”

                                               4
Chevelle, Celica, and Blazer as Fred’s separate property because the trial court acted

without reference to any guiding rules or principles. See Alvarado, 897 S.W.2d at 754.


                     Reimbursement of economic contribution claim


       Reimbursement is an equitable doctrine and a court of equity is bound to look at all

the facts and circumstances to determine what is fair, just and equitable. Penick v. Penick,

783 S.W.2d 194, 197 (Tex. 1988).2 When separate property is used to enhance the value

of the community estate, including the reduction of community debt, the spouse whose

separate property was used has an equitable right of reimbursement. Boyd v. Boyd, 131

S.W.3d 605, 612-13 (Tex.App.–Fort Worth 2004, no pet.). However, the party claiming a

right to reimbursement has the burden of tracing and identifying the separate nature of the

funds expended to reduce the community debt. Id. at 614-15. When a trial court must

surmise or speculate, based solely on a party’s testimony, that a party’s separate property

was expended to benefit the community, the community presumption will prevail. See

generally id. at 616-17.


       Fred testified that he used his separate funds as a down payment on the new shop

and that he renovated the shop using his separate funds and, thus, was entitled to

reimbursement. However, no documentary evidence was submitted to the trial court to


       2
        The use of separate property in the acquisition of property during marriage gives
the contributing spouse equitable title to the extent the contribution is not a gift.
Contributing separate funds as a down payment on real estate does not constitute an
economic contribution under section 3.401 of the Texas Family Code. See Garcia v.
Garcia, 170 S.W.3d 644, 650 (Tex.App.–El Paso 2005, no pet.) (citing In the Matter of the
Marriage of Royal, 107 S.W.3d 846, 851-52 (Tex.App.–Amarillo 2003, no pet.)).


                                             5
trace or identify the source of the funds used as a down payment on the shop. See id. at

615.3 We conclude that Fred failed to prove his right to reimbursement by failing to trace

and identify the separate nature of the funds; hence, the trial court erred in awarding

$15,000 to Fred as reimbursement for any payment on the purchase of the new shop. See

id. at 616.


                                       Harm Analysis


       Having concluded that the trial court erred in the characterization of the four items

purchased near the wedding date as Fred’s separate property, as well as concluding that

the trial court erred in awarding reimbursement to Fred for monies paid as a down payment

on a new shop, we now review those errors for harm.              In reviewing an alleged

characterization error, we must determine not only whether the trial court’s findings are

supported by clear and convincing evidence, but also whether the characterization error,

if established, constitutes more than a de minimis effect.        See id. at 617.     Mere

mischaracterization of community property as separate property does not require reversal.

See id. If the mischaracterization has more than a de minimis effect on the just and right

division of the community estate, then we must remand the entire case to the trial court for

a just and right division based upon the correct characterization of the property. See id.

Additionally, an erroneous reimbursement of economic contribution may also affect the just

and right division of property. Id. at 618.


       3
         Further indication that Texas case law weighs in favor of community property is the
rule that when separate property is used to acquire jointly titled property during marriage,
one half of the separate property is presumed to have been gifted to the other spouse
unless rebutted by evidence. See In re Marriage of Royal, 107 S.W.3d at 851.

                                              6
       Depending on the differing values assessed by the parties, and the values used by

the court, the four items designated by the trial court as Fred’s separate property made up

10 to 25 percent of the total community estate.4            When we include the erroneous

reimbursement from the community estate to Fred’s separate estate with the

mischaracterization of the four items purchased at or near the wedding date, 20 to 30

percent of the total community estate value was affected by the trial court’s erroneous

rulings. Accordingly, we conclude that the trial court’s rulings had more than a de minimis

effect on the division of the community estate, and as such, the division was so unjust and

unfair as to require us to remand the entire case to the trial court for a just and right division

based upon a correct characterization of the property. See id.


                                          Conclusion


       For the foregoing reasons, we reverse and remand this case to the trial court for a

just and right division of the community estate.




                                                    Mackey K. Hancock
                                                        Justice




       4
       For calculation purposes, we netted the value of the community property, including
the home and new shop, against the outstanding mortgages on those properties. The total
estimated value of the community assets is between $124,000 to $144,000.

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