## Facts

- Dorothy Gray Horlock and Roy M. Horlock married in 1966; Roy had three daughters from a prior marriage and the parties had one son.
- Roy entered the marriage with substantial separate property, including assets derived from his first wife’s estate and funds held in an investment account.
- During the marriage, Roy commingled separate funds with community funds in an investment account such that tracing a separate-property portion at divorce was not feasible.
- The parties separated in 1973; a divorce decree was entered in 1975 granting Dorothy a divorce and custody of the son.
- The decree ordered Roy to pay $750 per month child support and to cover specified medical, dental, orthodontic, and private-school tuition expenses.
- The decree divided the marital estate, allocated debts, awarded Dorothy’s counsel attorney’s fees (taxed to Roy), treated the commingled investment account as community property, and awarded Roy reimbursement for his separate-property contribution.
- During the marriage, Roy made gifts to his three daughters; Dorothy contended the gifts were excessive and harmed her community interest.
- Dorothy also contested the classification of certain Collegiate Services Corporation stock, arguing it was Roy’s separate property.

## Issues

1. Whether Roy’s gifts to his daughters constituted constructive fraud on the community estate warranting relief in the property division.
2. Whether the trial court could award reimbursement to Roy’s separate estate for separate-property proceeds that became totally commingled with community property and could not be traced.
3. Whether the overall community-property division was so unfair as to constitute an abuse of discretion under the “just and right” standard.
4. Whether the trial court erred in classifying certain Collegiate Services Corporation shares as community property.

## Decision

- The appellate court affirmed the divorce decree in all material respects.
- The court held the evidence did not require a finding of fraud on the community based on Roy’s gifts to his daughters.
- The court upheld the award of reimbursement to Roy’s separate estate despite commingling that defeated tracing for classification purposes.
- The court concluded the overall division was not so inequitable as to constitute an abuse of discretion.
- The court sustained the classification of the disputed Collegiate Services Corporation stock as community property because the separate-property claim did not overcome the community-property presumption.

## Legal Principles

- A trial court has broad discretion to divide community property in a manner it deems “just and right,” and an appellate court will reverse only for clear abuse resulting in a manifestly unjust division.
- A spouse’s inter vivos gifts of community property may constitute constructive fraud on the other spouse’s community interest, but whether fraud occurred depends on the circumstances and is reviewed deferentially.
- Reimbursement is an equitable remedy between marital estates; a trial court may award reimbursement for separate-property contributions that benefitted the community estate even when commingling prevents tracing sufficient to establish separate title.
- Property possessed during marriage or at dissolution is presumed community; the spouse asserting separate ownership bears the burden to clearly establish separate character.

## Conclusion

The court affirmed a divorce decree that treated a heavily commingled investment account as community property but reimbursed the husband’s separate estate for its contribution, rejected a fraud-on-the-community challenge to gifts made to the husband’s daughters, upheld the overall “just and right” division as within the trial court’s discretion, and sustained the community classification of disputed stock under the community-property presumption.


Horlock v. Horlock, 533 S.W.2d 52 (Tex. Civ. App.—Houston [14th Dist.] 1975)