## Facts

- Husband and Wife married in 1994; Wife filed for divorce about seven years later.
- Husband had formed DAX Enterprises, Inc. (DAX) before marriage and was its sole employee during marriage.
- Evidence showed Husband kept significant funds in DAX accounts, paid personal obligations from those accounts, and placed certain assets (including the family home) in DAX’s name.
- The parties disputed whether multiple assets and ventures were funded with community or Husband’s separate property.
- After a bench trial and post-rendering reconsideration proceedings that included additional valuation evidence, the trial court entered a final divorce decree dividing the marital estate.
- The trial court found DAX was Husband’s alter ego, awarded Wife a money judgment, and imposed liens on certain property awarded to Husband to secure payment.

## Issues

1. Whether the trial court erred in characterizing disputed property as community rather than Husband’s separate property.
2. Whether the evidence was sufficient to support the trial court’s valuations of disputed assets.
3. Whether the trial court properly imposed equitable liens to secure Wife’s money judgment, including whether it could impose an owelty of partition on partnership property.

## Decision

- The court of appeals affirmed the trial court’s characterization of the disputed property as community.
- The court of appeals affirmed the challenged valuations as supported by sufficient evidence.
- The court of appeals affirmed the use of equitable liens on property awarded to Husband to secure Wife’s money judgment.
- The court of appeals held the trial court erred by imposing an owelty of partition on partnership property, reformed the decree to delete that provision, and otherwise affirmed.

## Legal Principles

- In a bench trial, findings of fact have the same force and effect as jury findings; legal sufficiency review requires more than a scintilla of supporting evidence.
- Divorce property division is reviewed for abuse of discretion, with underlying fact findings reviewed for evidentiary sufficiency.
- Property possessed during marriage is presumed community; a spouse claiming separate property must prove the separate character by clear and convincing evidence.
- A trial court may disregard the corporate form in a divorce and treat corporate assets as part of the marital estate when the evidence supports an alter-ego finding, including commingling and personal use of corporate funds.
- A trial court may impose equitable liens on property awarded to a spouse to secure a money judgment in the divorce, but may not impose an owelty of partition on partnership property in the manner attempted here.

## Conclusion

The appellate court upheld the trial court’s community-property characterizations, alter-ego finding, valuations, and equitable liens securing Wife’s money judgment, but reformed the decree to remove an improper owelty of partition imposed on partnership property and affirmed the decree as reformed.


Young v. Young, 168 S.W.3d 276 (Tex. App.—Dallas 2005)