Schlueter v. Schlueter,
975 S.W.2d 584 (1998)

Facts: P transferred various community assets to his father shortly before he filed for divorce. D counterclairned for divorce and brought independent tort claims against P and her father in law seeking damages for breach of fiduciary duty, and conspiracy. P and D were married in 1969 and in 1992 P began investing in emus. He contributed S3,250 of community funds for a pair of the birds but eventually sold his interests to his father for $1,000. The business was worth at least $10,000. D did not learn of the details of the sale until the divorce was filed. Shortly before filing for divorce, P accepted a $30,360,41 check for taking an early retirement. P gave the check to his father and the father wrote himself a check for $ 2,565 allegedly to reimburse himself for past loans to P. A week later P filed for divorce. The jury found for D and the trial court awarded D a disproportionate division of the community estate favoring the wife and rendered judgment for D against P ($50,000) and the father in law ($15,000) for actual and exemplary damages. The court of appeals ruled that a tort cause of action for fraud on the community exists independent of a divorce proceeding. This appeal resulted.


Issue: Does a wronged spouse have an independent tort cause of action for damages to the community estate when the wronged spouse has an adequate remedy for fraud to the community through the "just and right" property division standard upon divorce?


Holding: No. Judgment reversed in part, affirmed in part, and remanded.District Court, entered judgment for wife, and husband and father-in-law appealed. The Austin Court of Appeals, Carroll,affirmed. On grant of writ of error, the Supreme Court, Gonzalez, J., held that: (1) there is no separate tort cause of action for fraud on the community estate, and (2) trial court's award to wife of attorney fees on appeal could not stand.

Analysis: Texas has abrogated the doctrine of interspousal immunity as to personal injury tort claims. An action for personal injury tort claims by one spouse against the other spouse is independent of a divorce action. The court held that no independent tort cause of action between spouses was available for damages to the community estate due to fraud on the community because an adequate remedy existed through the "just and right" property division on divorce. Because there was no independent tort cause of action, the wronged spouse could not recover punitive damages, but if the wronged spouse could prove the heightened culpability of actual fraud, the trial court could consider it in the "just and right" property division. The court concluded that the lower court correctly decided to admit into evidence a copy of the decree from petitioner husband's brother's divorce. The court reversed the award of attorney's fees to respondent because it reversed the lower court's award of exemplary damages against petitioners.