IN RE: the MARRIAGE OF Caroline BROOKSHIRE and Trenton Brookshire and in the Interest of R.L.B. (2026)

OPINION

Caroline Brookshire appeals the trial court's final decree of divorce. She raises eight issues on appeal. We affirm in part and reverse and remand in part.

Background 1

Caroline and Trenton (Trent) Brookshire married in a civil ceremony on March 4, 2014.² The couple had three children during the marriage: R.L.B., D.B.B., and H.A.B. Caroline filed for divorce in July 2022 and the trial court declared the couple divorced on March 22, 2024, in the marriage's eleventh year.

Premarital Agreement

Before marrying, Caroline and Trent signed a premarital agreement. In relevant part, it: (1) defined each individual's separate property, (2) characterized as Trent's separate property all Brookshire Holdings, Inc. stock (BGC stock) held in his name, and (3) subjected all BGC stock acquired during the marriage to a “community-property claim for reimbursement,” the value of which depended on the years of marriage. The agreement's section detailing the community property reimbursement claim stated:

4.2 All [Brookshire Holdings, Inc.] stock, if any, acquired by Trenton Brookshire during the marriage (other than by gift or inheritance) shall be subject to an accruing community property claim for reimbursement as follows:

․

4.2.3 11th year of marriage through 15th year of marriage: SIXTY (60%) PERCENT OF VALUE

․

The parties and the court-appointed tracing expert, Robert Bailes, agree that Trent sold all BGC stock acquired during the marriage. They further agree that the stock sold is subject to the community-reimbursement provision, and they agree it was sold for, and worth, $1,402,683.62. As such, the community estate had a reimbursement claim worth $841,610.17, which the trial court awarded to Caroline.³

Trent's Employment Suit

During the marriage, Trent worked for Brookshire Grocery Company (BGC), the family grocery company, as Chief Operating Officer (COO). His father Brad Brookshire was Chief Executive Officer (CEO). In 2021, Trent had a falling out with Brad and BGC, and the company terminated Trent's employment in October 2021.

Trent subsequently sued BGC and his father, alleging employment-related claims and seeking damages that include lost wages covering, as relevant to this appeal, the time between Trent's 2021 firing and the March 2024 divorce. The employment suit remains pending, awaiting trial. Both sides agreed at trial that any recovery for the lost wages incurred during marriage would be a community asset.

According to Trent's expert in the employment suit, those lost wages totaled $182,436 in 2021, $975,122 in 2022, $1,038,419 in 2023, and another $1,080,204 through the end of 2024. Trent estimated that he will have expended between $600,000 to $1.2 million in attorney's fees on the employment suit by the time of its conclusion.

During the marriage, Trent declined an offer to settle the employment suit because he believed that the terms of the settlement were too restrictive and not in his best long-term interests. The trial court awarded all the community estate's interest in Trent's employment-suit recovery to him, and none of the contingent recovery to Caroline.

Voltrona Interests, LLC and Ranch Property

During the marriage, Trent and Caroline formed a community property limited liability company, Voltrona Interests, LLC, with each party owning a fifty percent membership interest. In January 2017, Voltrona bought a 547.937-acre Smith County ranch, for $1.7 million, comprised of: (i) a $950,000 down payment; and (ii) a $750,000 loan. The down payment came from Voltrona's bank account, which earlier that month received a $950,000 deposit from the bank account of Trenton D. Brookshire, LLC (TDB LLC), a limited-liability company that Trent owns, formed before the marriage. Bailes referred to TDB LLC as an asset protection entity used by Trent. For purposes of this appeal, its main asset has been BGC stock. TDB LLC makes no products and provides no services to any customers. The couple paid off the loan in 2018. The trial court awarded the sum of $950,000 off the top of the proceeds from the receivership sale of the Voltrona ranch as a reimbursement to Trent's separate property estate.⁴

Trent's 2021 Sales of BGC Stock During the Marriage

During the marriage, in 2021, Trent sold $1,513,085.58 of individually-owned, separate property BGC stock. That same day, TDB LLC sold $444,450 of BGC stock that it owned. The capital-gains tax attributable to those stock sales totaled $225,487.

The proceeds of both 2021 stock sales were deposited into TDB LLC's bank account, then distributed into Trent's personally owned investment accounts at Vanguard and TD Ameritrade. Before the deposits, the Vanguard account held approximately $500,000 in community property funds from a prior real property sale, while the TD Ameritrade account then contained only a de minimus amount. At the time of trial, the Vanguard account held approximately $1.7 million. Caroline does not assert any interest in the amounts deposited in the TD Ameritrade account.

Bailes confirmed that, during the marriage, hundreds of thousands of dollars in community property income had been deposited into TDB LLC's bank account. This was a “common practice” for the entity. The trial court awarded Trent $1.2 million from the $1.7 million held at Vanguard as his separate property. The trial court also denied Caroline's reimbursement claim for $225,487 in capital gains taxes allegedly paid by the community estate for the 2021 BGC stock sales.

Trent's Wiretapping Suit Against Caroline

During the pendency of the divorce, Trent hired a Dallas law firm and spent $369,257 in pursuit of an ultimately unsuccessful wiretapping and invasion of privacy claims against Caroline. Further, an expert testified that if Trent hired a Smith County law firm to pursue this claim, a Smith County firm likely would have charged just 8% of the total charged by Trent's Dallas firm, or approximately $30,000. Notably, the trial court also determined the fees incurred by Trent for pursuing this suit were unreasonable. Caroline asserted an economic waste claim against the community. The trial court denied this claim because it believed Trent expended only separate property funds to advance the claims.

Caroline's Attorney's Fees

Caroline executed a promissory note to her father exclusively to pay for her attorney's fees she incurred during the divorce. At the time of the trial, the note showed an amount of $311,987. The trial court ultimately refused to include the value of the promissory note in the property division. Instead, the trial court ordered that each party pay their own attorney's fees.

The Trial Court's Orders Regarding the Possession Schedule of the Children

After Caroline filed for divorce, several months passed before the parties obtained a temporary order regarding possession of the children pending the outcome of the divorce proceeding. The temporary order granted an expanded standard possession schedule. But at the conclusion of the divorce suit, the trial court ordered a 50/50 alternating weekly possession schedule of the children.⁵ As discussed later in this opinion, the trial court heard extensive evidence regarding numerous allegations of wrongdoing and bad parental decisions by both Caroline and Trent.

On August 15, 2024, after multiple posttrial hearings, the trial court signed the Final Decree of Divorce. This appeal followed.

Incomplete Record

Prior to addressing Caroline's issues, Trent contends the record is incomplete and that we should apply the presumption that an incomplete record supports the trial court's judgment. He contends further that all of Caroline's issues require a review of the complete record. Accordingly, his argument continues, without a complete record, we should summarily overrule her issues and affirm the trial court's judgment. We disagree.

An appellant must request in writing that the official court reporter prepare the reporter's record, designate in the request the portions of the proceedings to be included, and file a copy of the request with the trial court clerk. Tex. R. App. P. 34.6(b). If the appellant requests a partial reporter's record, the appellant must include in the request a statement of the points or issues to be presented on appeal and will then be limited to those points or issues. Tex. R. App. P. 34.6(c)(1). If the appellant complies with Rule 34.6(c)(1), the appellate court must presume that the partial reporter's record constitutes the entire record for purposes of reviewing the stated points or issues. Tex. R. App. P. 34.6(c)(4). However, if the appellant fails to file a statement of points or issues, the record is deemed incomplete, and the appellate court presumes that the missing portions of the reporter's record are relevant and support the trial court's judgment. Bennett v. Cochran, 96 S.W.3d 227, 229 (Tex. 2002); In re Tyler, 408 S.W.3d 491, 494 (Tex. App.—El Paso 2013, no pet.).

Trent's complaint relates to the handling of several video exhibits, and one audio exhibit. The video exhibits at issue here are from police officers' body cameras, a “nanny camera” at the couple's home, and videos captured on a cellular phone by Caroline. There is also a telephone call recording from Trent's private investigator to the police. The trial court admitted those exhibits in their entirety, and not limited portions of the exhibits or for a limited purpose.⁶

After the trial's conclusion, Caroline filed a written request for a complete reporter's record, including transcripts from all nine days of trial, all post-trial hearings, and all exhibits. Trent's argument takes aim at the fact that when only limited portions of these audio and video exhibits were played to the court during the bench trial, the court reporter did not transcribe the specific portion of the exhibit heard by the court. Trent contends that without knowing which portion of the video was played to the trial court, we cannot review Caroline's issues.

The cases cited by Trent as support involve scenarios where only portions of a video deposition were played and the court reporter failed to transcribe the played portion. See, e.g., White v. Lozano, 719 S.W.3d 407, 420-21 (Tex. App.—Corpus Christi–Edinburg 2025, no pet.); Arthur J. Gallagher & Co. v. Dieterich, 270 S.W.3d 695, 699 (Tex. App.—Dallas 2008, no pet.); In re Estate of Arrendell, 213 S.W.3d 496, 501-02 (Tex. App.—Texarkana 2006, no pet.); Taveau v. Brenden, 174 S.W.3d 873, 877 (Tex. App.—Eastland 2005, pet. denied); Cook v. Kovatch, No. 05-22-00347-CV, 2024 WL 301920, at *5-6 (Tex. App.—Dallas Jan. 26, 2024, no pet.) (mem. op.); City of Palestine v. LS Equip. Co., Inc., No. 12-19-00264-CV, 2020 WL 5047905, at *7-8 (Tex. App.—Tyler Aug. 26, 2020, no pet.) (mem. op.).

Video depositions are different than other types of audio and video exhibits, because they represent the testimony of the witness as if in live court. For such an exhibit, we must know which portions of the deposition the trial court heard. This is necessary to evaluate the deposition's effect on the factfinder's ultimate decisions and whether it abused its discretion or the findings are supported by sufficient evidence. Other audio and video exhibits, such as police body cameras and cellular phone videos are like other physical evidence, and once generally admitted, the entirety of the exhibits are admitted for all purposes unless specifically limited by the trial court. See Tex. R. Evid. 105; Birchfield v. Texarkana Memorial Hosp., 747 S.W.2d 361, 365 (Tex. 1987); First United Bank v. Panhandle Packing & Gasket, Inc., 190 S.W.3d 10, 17 (Tex. App.—Amarillo 2005, no pet.); Cigna Ins. Co. v. Evans, 847 S.W.2d 417, 421 (Tex. App.—Texarkana 1993, no writ) (stating evidence admitted without limitation is before court for any and all purposes). Furthermore, once evidence is received without a limiting instruction, it becomes part of the general evidence in the case and may be used as proof to the full extent of its rational persuasive power. Gabriel v. Lovewell, 164 S.W.3d 835, 845 (Tex. App.—Texarkana 2005, no pet.).

In fact, the trial court recognized this on the record and made it clear to the parties when it stated as follows: “Well, when I submit an exhibit, unless I say it's admitted for some limited purpose, it's admitted for all purposes. So I would have to look at the record. If it's in evidence though, I think [counsel] can ask about it.” Here, the exhibits were admitted in their entirety without any objection, request that their admission be limited in any way, or a request that only the portions played be considered by the trial court. Thus, they were admissible in their entirety for all purposes as part of the general evidence and the court could consider them to the full extent of their rational persuasive power. In essence, these video exhibits are like any other non-deposition exhibit that is admitted into evidence. We deny Trent's requests that we (1) apply the partial record presumption, (2) overrule Caroline's issues, and (3) dismiss the appeal.

Findings of Fact and Conclusions of Law

In her first issue, Caroline contends that the trial court failed to make appropriate findings of fact and conclusions of law and she suffered harm as a result.

Caroline timely requested findings of fact and conclusions of law along with a notice of past due findings. The trial court ultimately issued written findings of fact and conclusions of law. Caroline's initial request specifically sought findings: (1) under Texas Family Code Section 6.711; (2) regarding the characterization and value of all assets, liabilities, claims, and offsets on which disputed evidence had been presented; and (3) identifying the trial court's specific reasons for deviating from the standard possession order under Texas Family Code Section 153.258.

Unlike many of the cases where a party complains of a lack of findings, the trial court here issued a ten-page document containing its findings of fact and conclusions of law. However, unsatisfied with the trial court's findings on these issues, Caroline requested additional or amended findings and conclusions. In this request, she specified the deficiencies in the trial court's findings. The trial court filed no additional or amended findings or conclusions. On appeal, Caroline requests that we either remand for a new trial, or alternatively, abate the appellate proceedings to require the trial court to make amended findings of fact and conclusions of law.

The trial court has a mandatory duty to file findings and conclusions, as well as additional or amended findings and conclusions, when a party makes a proper request. See Tex. R. Civ. P. 296, 298; Wagner v. Riske, 178 S.W.2d 117, 119 (Tex. 1944). The trial court's findings and conclusions must properly and succinctly relate the ultimate findings of fact and law necessary to apprise a party of adequate information for the preparation of her appeal. In re Marriage of Morris, 12S.W.3d 877, 886 (Tex. App.—Texarkana 2000, no pet.).

In a suit for dissolution of a marriage in which the court rendered a judgment dividing the estate of the parties, on request by a party, the court shall state in writing its findings of fact and conclusions of law, including the characterization and value of all assets, liabilities, claims, and offsets on which disputed evidence has been presented. Tex. Fam. Code Ann. § 6.711. Similarly, in all cases in which possession of a child by a parent is contested and the possession of the child varies from the standard possession order, including a possession order for a child under three years of age, on request by a party, the court shall state in writing the specific reasons for the variance from the standard order. Id. § 153.258. The trial court recited only that it considered the statutory factors, did not make the required findings under Texas Family Code Sections 6.711 and 153.258, and consequently erred.

Normally, when a trial court fails to issue controlling findings of fact and conclusions of law, we presume harm. See, e.g., Cherne Indus., Inc. v. Magallanes, 763 S.W.2d 768, 772 (Tex. 1989); see also Alan Acceptance Corp. v. E. Tex. Nat. Bank of Palestine, 109 S.W.3d 511, 516 (Tex. App.—Tyler 1998, no pet.). Although “harm to the complaining party is presumed unless the contrary appears on the face of the record,” a trial court's “failure to make findings is not harmful error if ‘the record before the appellate court affirmatively shows that the complaining party suffered no injury.’ ” Tenery v. Tenery, 932 S.W.2d 29, 30 (Tex. 1996) (quoting Cherne Indus., 763 S.W.2d at 772). When the trial court announces its reasons for its ruling in open court, the appellant's ability to present the appeal is not harmed because there was no need to guess the reasons for the trial court's adverse ruling. See, e.g., Culver v. Culver, 360 S.W.3d 526, 538 (Tex. App.—Texarkana 2011, no pet.).

In this case, after nine full days of trial and during closing argument, the trial court stated: “This is another reason why when I give my ruling I'll probably prefer to do it in person, that way I can have you clarify some positions.” The trial court subsequently held three separate posttrial hearings announcing its rulings and rationale for them. During these hearings, trial counsel was present and had extensive discussions with the trial court concerning its rulings and findings. Furthermore, the parties thoroughly briefed to this court their arguments in support of their respective positions on the issues raised. Under this record, we see no reason to remand for a new trial or abate the appeal at this juncture for amended findings of fact and conclusions of law.

Accordingly, Caroline's first issue is overruled.

Child Custody

In Caroline's eighth issue, she argues that the trial court abused its discretion when it deviated from the standard possession order and instead ordered a 50/50 alternating weekly possession schedule for each parent.

Standard of Review and Applicable Law

This Court reviews the trial court's possession order for an abuse of discretion. Gillespie v. Gillespie, 644 S.W.2d 449, 451 (Tex. 1982). A trial court abuses its discretion when it acts arbitrarily or unreasonably without reference to any guiding rules or principles. Worford v. Stamper, 801 S.W.2d 108, 109 (Tex. 1990). Under this standard, legal and factual insufficiency are not independent grounds for asserting error but are relevant factors for the Court to examine in assessing whether the trial court abused its discretion. In re B.J.H.-T., 2011 WL 721511, at *3 (Tex. App.—Tyler March 2, 2011, pet. denied) (mem. op.); Niskar v. Niskar, 136 S.W.3d 749, 753 (Tex. App.—Dallas 2004, no pet.).

“In determining the issues of conservatorship and possession of a child, the trial court is given wide latitude in determining the best interest of the child and will be reversed only for an abuse of discretion.” Matter of Marriage of Cruey, 2025 WL 2416806, at *4 (Tex. App.—Tyler Aug. 20 2025, no pet.) (mem. op.). “When the testimony of witnesses is conflicting, we will not disturb the credibility determinations made by the fact finder, and we will presume that it resolved any conflict in favor of the verdict.” Id. “Further, there is no abuse of discretion where the record contains some evidence of a substantive and probative character in support of the trial court's decision.” Id. We consider the entire record and all the evidence to determine if the trial court abused its discretion. Interest of A. A. S., No. 12-22-00207-CV, 2023 WL 4308673, at *2 (Tex. App.—Tyler June 30, 2023, no pet.) (mem. op.).

“Joint managing conservatorship does not require the award of equal or nearly equal periods of physical possession of and access to the child to each of the joint conservators.” Tex. Fam. Code Ann. § 153.135. Rather, the Texas Family Code presumes the standard possession order to be the reasonable minimum possession schedule that is in the child's best interest. Id. § 153.252. To stray from the standard possession order, the court must consider: (1) the age, developmental status, circumstances, needs, and best interest of the child; (2) the circumstances of the parent conservators; and (3) any other relevant factor. Id. § 153.256.

When reviewing best interest findings, factors that courts consider include (1) the child's wishes, (2) the child's emotional and physical needs now and in the future, (3) emotional or physical danger to the child now and in the future, (4) the parenting abilities of the parties seeking custody, (5) programs available to help those parties, (6) plans for the child by the parties seeking custody, (7) the stability of the proposed placement, (8) the parent's conduct that may indicate that the existing parent–child relationship is improper, and (9) any excuses for the parent's conduct. Holley v. Adams, 544 S.W.2d 367, 371–72 (Tex. 1976). This list is not exhaustive, not all factors need be proven to establish best interest, and proof of only one factor may in a particular factual context support the trial court's findings. See In re C.H., 89 S.W.3d 17, 27 (Tex. 2002).

Overview

At the commencement of trial, Caroline's counsel announced that she sought both parents' appointments as joint managing conservators, even though the vast majority of the suit's progression indicated a highly adversarial posture in which she sought to be appointed sole managing conservator. This came as a surprise to the trial court, the amicus attorney, Trent, and Trent's counsel. Nevertheless, the trial continued for nine days, and Caroline's strategy largely appeared to detail all of Trent's alleged bad actions as a parent. She admitted during her testimony at trial that she played a role in the litigation's contentiousness.

The overall evidence showed that Caroline and Trent initially attempted to civilly coparent the children prior to the trial court's issuance of temporary orders from June through late-August 2022. However, this changed when Caroline discovered that Trent began a romantic relationship with another woman, Amber Oberg. At that point, she restricted Trent's access to the children, and he saw them very little until the trial court issued a temporary order regarding possession in January 2023. Since August 2022, and continuing through the trial, both parties inflicted and suffered much consternation during the divorce process.

It is clear from the record that the trial court was highly persuaded by the closing argument and recommendation for a 50/50 schedule by the amicus attorney appointed to represent the children, with some slight modifications. As part of our review, based on this record, we must greatly detail the parties' actions leading up to and throughout this litigation to adequately discuss the trial court's exercise of discretion when it deviated from the standard possession order.⁷

July 2022 Father's Day Argument Precipitating Separation

Trent and Caroline resided at a home Trent acquired prior to the marriage.⁸ Trent began working for BGC on August 11, 2006. When disputes arose between Trent and Brad, BGC put Trent on leave in early summer 2021, which caused a rift in Trent's relationship with his parents.⁹ Trent and Caroline agreed that if there could be “healing through interaction” with Trent's parents, it needed to start between Trent and his parents. They agreed their children would not see Trent's parents until that occurred. BGC terminated Trent's employment on October 18, 2021.

On June 18, 2022, Caroline told Trent, “It's Father's Day weekend, why don't you go do whatever you want to do for the weekend.” She said she was taking the kids to see her parents. Trent thought he would “surprise Caroline” by also going to her parents' house to visit them. When he arrived and she was not present, he discovered via the “find my friend” app that Caroline and the children were at his parents' home.

Trent called Caroline in “a fit of anger” because she secretly violated their agreement about his parents. The testimony conflicts about whether Trent made threatening statements in the call about (1) his parents only or (2) both his parents and Caroline. But in a subsequent text, Trent told Caroline, “I wasn't directing anything towards you at all,” and instead claimed any threats to “beat some ass” were directed solely to his parents.

Caroline testified that prior to this, she secretly took the kids to see his parents on other occasions. Caroline “knew that if [Trent] found out” she did this “behind his back,” it “would be a point of contention.” Caroline told the kids not to tell Trent about these visits.

On the day of the argument, Caroline took the children to live with her at her parents' home. A few days later, Caroline texted Trent that “[w]e are not coming back home.” She and their children lived with her parents from then until a few months later in September.

Caroline filed for divorce on July 26, 2022. Her initial pleading alleged only insupportability as the ground for divorce and requested the court to appoint the parties as joint managing conservators of their children. The parties entered into a Rule 11 agreement that gave Caroline control over when Trent could see the children. Until the temporary orders of January 2023, Trent made requests to Caroline any time he wanted to see the children.

Trent's Relationship with Amber Oberg

Before August 27, 2022, the parties' communications and coparenting of their children was “surprisingly ․ cordial, courteous, professional even.” This came as a shocking revelation to the amicus attorney, who observed only discord between the parties after his appointment in the case.

During their marriage, the parties placed several “nanny cameras” inside their home. On August 27, Caroline arrived at Trent's house “visibly infuriated” and said she “couldn't believe that [he] had found someone else.” Caroline unlocked her phone and Trent could see she accessed the nanny camera app. According to Trent, he observed that she saved several audio recordings on her phone app. Caroline then played two audio recordings of intimate events between Trent and Oberg in the master bedroom. Caroline indicated she had more recordings.¹⁰ Trent testified that Caroline “started screaming at [him] demanding to know who this person was” and exclaimed, “we're never getting back together now.” Trent testified he never expected Caroline would eavesdrop on him after she moved out, said she was never coming back, and filed for divorce. Caroline admitted Trent had a reasonable expectation of privacy at home after she filed for divorce.

After these events, Caroline amended her petition. For the first time, she alleged Trent physically and sexually assaulted her. She also sought to use Trent's alleged fault as a basis to appoint her as the children's sole managing conservator and restrict his access to them by a requirement of strict supervision. She asserted tort claims against him for the alleged abuse and sought a disproportionate share of the parties' marital estate.

Caroline's Relationship with Russell Lindsey

Trent's best friend was Russell Lindsey.¹¹ According to Trent, they spoke every day. Trent assisted Lindsey in obtaining contract employment at BGC. Lindsey, his wife, and their children attended Trent's children's birthday celebrations. Lindsey stayed overnight at the couple's home on several occasions, they traveled internationally together, and the children referred to him as “Uncle Russ.”

In early September 2022, Caroline moved out of her parents' house and into an apartment. That October, Lindsey left his wife and children in Abilene and moved into the same apartment complex as Caroline in Tyler, Texas. Lindsey subsequently filed for divorce from his wife. At some point, Lindsey's wife told Trent about Caroline's relationship with Lindsey.

Trent testified that after Caroline confronted him with the recordings made at the home, the “relationship went ice cold immediately.” From August 27 until the court entered temporary orders in January 2023, Caroline almost entirely restricted Trent's access to his children, despite his repeated requests to see them. For example, during Thanksgiving and Christmas break in 2022, she took them on all-expense-paid trip to Disney World and Colorado via private jet with Trent's parents. Caroline allowed Trent access to the children on a limited basis during these breaks from school. In a series of texts, Caroline admitted she denied him access to the kids because of her anger about Trent's sleeping with Oberg in their “marital bed.” We note that at the time, Caroline moved out, said she was never coming back, filed for divorce, and began a relationship with Lindsey. Trent testified Caroline's keeping “the children from their father as retribution [was] a very low course of action.”

In January 2023, the trial court issued a temporary order regarding possession of the children during the suit. The parties were joint managing conservators, Caroline determined their residence, and Trent had an “expanded standard order” starting January 17.

Caroline testified that in January, she went on a trip with Lindsey to Florida, but the kids did not travel with them, and she and Lindsey stayed in separate rooms. She denied they had a romantic relationship at the time. They also went together on trips with her family and Trent's family, and Lindsey was often in the children's presence.

Caroline denied having a romantic relationship with Lindsey before mid-August. After that, she took the children on overnight trips with him. On August 21, the parties agreed to modify the temporary orders to allow Lindsey and Oberg to be around their children.¹²

Kidnapping Allegation

On Wednesday, August 30, 2023, two days before Labor Day Weekend, Trent sent Caroline the following text: “I found a great deal and am planning on taking the kids on a trip for the holiday weekend. It's a surprise for them but wanted to let you know. We can arrange a FaceTime call while we are away if you'd like.” Later that day, Caroline responded to Trent with the following text: “Good. Hope y'all have fun.” She did not ask Trent for any details about the trip.

In the past, Trent and Caroline frequently took their children out of All Saints Episcopal School—where the kids attended school early on a Thursday for long weekend trips. An All Saints administrator testified it was a common practice for parents to take their kids out of school on days before and after a weekend to “take long weekends or going into holidays.”

The parties agree that the temporary order regarding custody and notifications to other parents was confusing. In any event, on the Thursday morning before Labor Day Weekend, an All Saints administrator called Caroline and told her Trent picked up the kids at school around 9:55 a.m. that day. Caroline testified she could not reach Trent, so “someone” contacted law enforcement about it. Trent testified he received messages from Caroline but was driving to Dallas-Fort Worth (DFW) airport and could not respond while driving.

Jimmy Toler, the City of Tyler Police Chief, testified that Brad called his cell phone. Brad told Chief Toler he had “concerns that Trent had taken the kids and [was] headed toward the airport.” Chief Toler immediately sent Officer Bradley Smith to interview school officials and Caroline at All Saints.¹³

Officer Smith arrived at All Saints and went into an office to meet with Caroline, the All Saints administrator, and others. His bodycam video of the meeting was admitted into evidence. An All Saints employee told Smith that when Trent picked up the kids that morning, he told her he “had a flight to catch” and told the kids when they came into the office that “he had a surprise for them.” The administrator testified that Caroline never showed her the text exchange with Trent where she agreed to the trip.

Caroline told Officer Smith that Trent had not “mentioned any of this to her,” Trent “was using drugs” (even though she knew Trent passed all his drug tests since October 2022), “the kids could be in danger,” and she did not “think that [Trent's] going to bring the kids back.” Officer Smith asked Caroline if she spoke with Trent, who replied she had no communication with him.

During the meeting, Caroline used two cell phones to talk and text with Trent's parents, her parents, and her siblings as she met with law enforcement and school officials. After Caroline talked to Brad, she informed Officer Smith that the police department was “probably going to issue an Amber Alert.”¹⁴ During her testimony, the trial court asked Caroline, “Did you think the children were in danger in [Trent's] possession at that time?” Caroline responded, “No, but I was worried about his mental state at that time.”

Officer Smith called his immediate supervisor and a lieutenant, who told him Chief Toler was sending a lieutenant, two detectives, and a sergeant to All Saints, who arrived and assumed the investigation. Detective Alejandra Flowers testified she went to All Saints with the understanding that Trent took the children without Caroline's knowledge. Caroline never told Detective Flowers that on the prior afternoon, Trent told her he was taking the kids on a trip and she consented. Lieutenant William Sinclair also went to All Saints to investigate “what sounded like a child abduction at first.” At All Saints, Lieutenant Sinclair talked to Caroline, who told him Trent took her children. She never disclosed to him that she agreed to the trip. To the contrary, Lieutenant Sinclair testified Caroline said she “hadn't agreed ․ for him to take the children.” Caroline admitted Sinclair asked her if Trent “said anything to you about this” trip with the kids, and she responded that Trent told her nothing about the trip. Caroline admitted at trial she never gave the police the texts with Trent in which she agreed to Trent's trip with their kids.

The police at DFW airport were told to apprehend Trent. As Trent and the kids approached their gate at DFW for their flight, Trent saw “five police officers” at the gate. He “was immediately alarmed” but had no idea they were there for him until they approached him and the kids.

Lieutenant Sinclair testified he communicated with a DFW airport police sergeant. The DFW sergeant related he spoke to Trent at the airport, who showed him the texts with Caroline consenting to the trip. Based on those messages, the DFW police allowed Trent and the children to board the airplane for their trip.

At 11:59 a.m., while at DFW airport, Trent texted Caroline and apologized for any confusion that morning, reassured her the kids would be safe, and offered for her to “FaceTime” the kids during the trip. Caroline never responded. Although a bodycam video recorded Caroline viewing the phones while in the room with the officers at All Saints, she said nothing to them about Trent's text message. When a police officer asked if she wanted to press charges against Trent, she replied, “Yes.” Lieutenant Sinclair then talked to Caroline twice about allowing Trent and the kids to continue on their trip. Sinclair testified that each time he asked her, Caroline “was adamant that she had not given permission for them to leave or to go on this vacation.” Lieutenant Sinclair then contacted the DFW sergeant again and learned that Trent and their children already boarded the plane, which was about to take off.

Lieutenant Sinclair testified he informed Caroline of that fact, but she “was still adamant that we pretty much go by the court order as far as she had not given permission,” and told him to have the DFW police remove the children from the airplane based on the language of the temporary order regarding possession. Caroline stated she “wanted the kids off of the plane” and “was adamant again that she had not given permission for them to be on the plane.” Trent testified that while on the plane in their seats, an officer approached him and indicated he was being detained because Trent “kidnapped the children and was trying to take them across state lines.” The children, seated nearby, heard what the officer said. A flight attendant approached Trent and said they had “to deboard right now,” a command to which he complied.

Trent testified that when they walked back to the gate, they spoke again to the airport police. The children watched and heard the uniformed officers question Trent. Trent testified his children were confused and sad they were “not going to be able to fly.” According to Trent, he told the children he made a mistake, they boarded the wrong airplane, and they would have to fly another day. Ultimately, Trent returned to Tyler with the kids and had them in school on Friday. Trent rebooked the flight and flew out on their trip on Friday evening.

Lieutenant Sinclair testified no one at the Tyler Police Department attempted to contact Trent on his cell phone at any time before the DFW airport police removed him and his children from the airplane. After the officers left All Saints, the DFW Sergeant forwarded to Sinclair a copy of the parties' texts the prior afternoon, when Trent told Caroline he was taking the kids on a trip and she responded, “Good. Hope y'all have fun.” When Sinclair saw the texts, the Tyler Police Department closed the case.

Caroline testified she “had no idea” her reporting to the police that Trent abducted their children would cause the children to see police officers talking to their dad. She was not concerned that their children would think “[m]y dad's done something wrong. This is bad. I need to be afraid of my dad.”

Physical and Sexual Assault Allegations

As noted above, Caroline asserted tort claims against Trent for his purported sexual and physical assaults and sought extensive damages. Caroline also asked the court to consider Trent's alleged assaults in deciding the parties' possession schedule.

First, Caroline testified that on September 15, 2015, the parties got into an argument at home during which Trent shoved his hand in her face and injured her eye, causing it to swell. She introduced a photograph she allegedly took of her face at the time. But her personal journal entry for that date stated she went shopping with her mother in Dallas that day.¹⁵ In fact, her journal entry ten days earlier, on September 5, 2015, states, “Woke up to a swollen right eye, went to urgent care, and [doctor] gave me a pregnancy safe antibiotic ․ and iced my eye.”

Second, Caroline testified that “for my birthday” on May 17, 2020, “my only request was to be left alone and not touched.” She testified that after Trent's parents picked up their children that day, she put on her swimsuit and planned to read a book by the pool. “Trent had other plans and took me to the playroom and had sex with me and held me down on my face and on my stomach and was biting me over and over again on my back.” She testified she screamed, yelled, and cried for him to stop but he would not. Trent testified the parties had an argument that day because Caroline was dissatisfied with “the quality of the birthday gift that I got her,” which was a “Breitling watch.”

Third, Caroline testified that on October 28, 2020, Trent held her down while they had sex, she screamed for him to stop, but he would not allow her to get up. Fourth, Caroline asserted that an event occurred in December 2020, but the record is sparse on this allegation. Finally, Caroline testified, on August 20, 2022, she went with the kids to the home after the parties separated and Trent “pushed me up against the wall and was trying to kiss me” against her will. Trent denied all these allegations at trial.

Caroline testified she told two people and no one else about Trent's assaults: Dr. Shannon Glass and Nancy Mayer. Their testimony cast doubt on the veracity of these claims. Dr. Glass is a diagnostic radiologist in Tyler. She and Caroline were best friends and in constant communication until Caroline abruptly terminated their friendship without explanation after she left Trent. Before that they communicated with each other through calls, texts, or in person every day and shared intimate secrets they would not tell others.

A few days after Caroline's birthday on May 17, 2020, Dr. Glass texted Caroline, “How was your birthday?” Caroline texted back, “This is how my birthday went” with a picture showing that Caroline had “hickies” on her back.¹⁶ Dr. Glass testified Caroline was joking about it and never said Trent assaulted her, bit her, or anything else to cause Dr. Glass any concern about Caroline. Dr. Glass testified that during their friendship, she asked Caroline about whether Trent ever abused her. Dr. Glass explained that she grew up in a home where her mother was beaten and for that reason was hypervigilant about the issue with her friends. Dr. Glass testified she asked Caroline this twice and each time Caroline responded, “No.” Dr. Glass testified she was around Caroline frequently and never saw any sort of bruising, injuries, or anything else that indicated Trent ever abused Caroline. During the eight years they were “best friends,” Caroline never told Dr. Glass that Trent was abusive, he forcibly sexually assaulted her, she feared him, Trent was “crazy,” or he used drugs.

Mayer, a licensed professional therapist since 2004, counseled both Caroline and Trent individually and together. Mayer's first session with Caroline was on June 10, 2020, approximately one month after Trent allegedly assaulted Caroline on her birthday. At that visit, Caroline filled out a counseling questionnaire indicating that she was not subject to physical or sexual abuse, not often nervous or frustrated, did not feel overwhelmed “that something bad was going to happen” in the past twelve months, had no physical, sexual, or emotional difficulties with a family member, and had no suicide attempts by a family member or herself. Caroline also wrote on the intake form that her goals were “to strengthen our marriage, and to better myself as a person.” Caroline, however, testified the reason she went to Mayer was to receive counseling for Trent's alleged sexual assault on her birthday.

Mayer testified that during their first session, Caroline said, “Trent is a fabulous father, sweet, kind, and loving to the children.” Caroline said in the session that “she was the shark and Trent was the turtle” in their relationship, indicating “she raises her voice, hammers her voice, wants answers now, is critical and defensive,” and Trent's response was to become withdrawn.

Mayer testified that Caroline never told her that Trent sexually assaulted her. Instead, Caroline said when Trent wanted sex and she refused, Trent “stonewalled” her by not talking. Caroline never told Mayer in any session that Trent ever forcibly sexually assaulted her, physically assaulted her, or hurt her. During any of their multiple counseling sessions during the two-year period from June 10, 2020, to July 14, 2022, Caroline never said anything that led Mayer to believe Caroline was in danger with Trent.

In their session on June 20, 2022, Caroline told Mayer about a problem between Trent and his parents, and Caroline agreed with Trent not to allow Trent's parents to see their children. Mayer explained that Caroline told her that on June 18, Trent discovered Caroline lied to him by taking their children to see Trent's parents, and he became angry. Mayor related that Caroline further told her they had an argument in which Trent's “voice escalated because he found out that she had been lying to him.”

Caroline testified that she “went into depth” in discussing the incident on her birthday with Mayer. Caroline testified Mayer was not honest about their discussions by not including them in her therapy notes. Mayer's response was, “That is not true ․ There was not abuse.” She iterated that if Caroline reported any abuse, it would “absolutely” be in her counseling notes because “[w]ith all of my clients, if there is ever any type of abuse, I note it and write exactly what they've told me, and we have an exit plan.” An “exit plan” is a plan for a client “to leave their spouse.”

As to Caroline's claim that she asked Mayer not to put it in her notes, Mayer testified Caroline “never told me” about any abuse, and “I wouldn't care if she did tell me not to put it in there, I would have put it in there” anyway because “my license is on the line. And I'm not willing to put my license on the line for anyone.”

It is undisputed that Caroline never reported any alleged assault to law enforcement or to a medical provider like a doctor or nurse. And Caroline conceded that her detailed written journals and calendars she made during the marriage and produced during discovery do not contain any evidence of Trent's alleged abuse. Trent denied in his testimony that he ever assaulted Caroline.

Other Alleged Incidents

The first weekend of Trent's possession of the children under the agreed temporary orders was January 20 through 22, 2023. It was Trent's first weekend visit with them in several months. After Trent returned the children to her, Caroline promptly reported to the Texas Department of Child Protective Services (CPS) that Trent was guilty of neglectful supervision of all three kids.¹⁷ Caroline admitted she did not contact Trent to ask him about her accusations before she called CPS.¹⁸

Specifically, Caroline reported to CPS that Trent (1) neglected H.A.B.'s medical needs leading to painful skin conditions and illnesses; (2) left R.L.B. in dirty underwear; (3) in a separate incident, locked R.L.B. in a car at the ranch for over an hour, telling her the rams on the ranch would “gore her to death;”¹⁹ (4) sent the parties' son to school without his glasses (Trent testified this “happened probably twice over two years” and each time he “immediately” took the glasses to him); and (5) repeatedly failed to send a nap mat to school for H.A.B. CPS interviewed Trent and each child. CPS later issued a letter stating that “based on the available information it was reasonable to conclude that the alleged abuse or neglect did not occur.”

Caroline also accused Trent of showering with the children and allowing D.B.B. to shower with a slightly older neighbor boy. Trent denied these allegations. Additionally, Caroline claimed Trent made a poor choice when he designated James Meadows, who she alleged had been in prison for sexual assault and rape of a child, to pick the children up from school. According to Caroline's own evidence, Meadows was convicted of “injury to a child.”²⁰ Trent testified he did not know about the conviction until May or June 2023. Trent learned this after he designated Meadows on the list to pick up the kids from school, but Meadows never actually picked them up. According to Trent, Meadows worked for BGC and cleared BGC's criminal history check. Trent and Caroline were friends with Meadows and his wife, who had been around the children at the parties' home many times and he apparently never harmed the children. Caroline ultimately admitted she did not believe Trent would allow the children to be in a dangerous situation of a sexual nature.

Caroline offered evidence that Trent used prescription medications that were not prescribed to him, marijuana, and steroids. She asserted that he vaped THC around the children and left marijuana paraphernalia around the home. She also points to a drug test where he tested positive for CBD-THC. Trent denied using illegal drugs. Trent testified that the test on October 13, 2022, which detected CBD-THC, resulted from his use of a legal product containing CBD-THC. After this result, Trent had additional drug tests in connection with this case, all of which were negative for any drug use. It appears that he was prescribed needles for testosterone replacement therapy (TRT).

Caroline further contended that Trent unsafely handled firearms including leaving handguns, rifles, and shotguns within the children's reach. Trent denied this accusation. He testified he was “sensitive to gun safety around the children” because he “lost his grandfather to gun violence.”

Caroline's counsel also attempted to ask about Trent's purported attendance at a strip club during his periods of possession, although no one insinuated that he actually took the children to such an establishment. When Caroline's attorney asked Trent about this, the court ruled it was irrelevant, a ruling she does not challenge here.

Related to these incidents, Caroline submitted photos of one of the children holding a used TRT needle and an open trash can full of used TRT needles and dirty diapers. She submitted a photo of what appeared to be marijuana paraphernalia on a table near the swimming pool. She also presented a photo of what Trent testified was Caroline's handgun easily accessible on a China cabinet shelf. Caroline presented videos she recorded of the children when they were crying and upset about going to visit Trent after their separation.

Kevin Scully, the parties' primary health care provider, testified that while Caroline was out of town, she became concerned that D.B.B. was ill. She asked him to visit D.B.B. while he was in Trent's possession. Upon arrival, Scully determined that D.B.B. had a fever and a “big ear infection.” Scully said that when he arrived, Trent was “hanging out drinking” with friends. He testified that Trent did not appear able to drive and pick up the prescribed antibiotic.

Scully further stated he witnessed the children in Trent's care at a crawfish boil where the children wore shorts and long sleeve T-shirts even though the temperature was fifty degrees and the children's skin felt cold to the touch. He testified that Trent drank the entire time and left the children at the crawfish boil so he could purchase additional alcohol. In contrast, Trent testified that it was comfortable weather at approximately seventy degrees, everyone wore shorts and t-shirts, and he left the party for ten to fifteen minutes to purchase a six pack of beer. He denied being intoxicated at the time and claimed that he no longer consumes any alcohol.

Scully also testified that Trent loudly called Caroline derogatory names in the presence of the children, which Trent denied. There were discrepancies between Scully and Caroline's testimony as to when he related this to her. Trent testified that Scully was very near bankruptcy in 2019, and that Trent assisted him in salvaging his medical practice, namely by securing an ongoing beneficial business relationship with BGC. Trent implied that Scully had a financial motivation for discrediting Trent given his poor relationship with the rest of the Brookshire family. The amicus attorney argued that Scully essentially lacked credibility.

In another incident, Caroline offered evidence that Trent recently took R.L.B. to get her ears pierced without Caroline's knowledge. Caroline testified that this upset her because it is an important mother-daughter ritual. Trent admitted that he did so. He also offered evidence that Caroline engaged in similar behavior when she brought one of their sons to dental surgery under sedation in Dallas. He explained that she did not tell him when and where the surgery would occur.

Finally, Trent's mother Ann Brookshire testified against him and described Caroline as “the best” mother and Trent as “uninvolved” with the children. She testified to Trent's alleged issues with guns, prescription pills, and “erratic behavior” around the children. We note that Ann had not seen Trent since the family argument and falling out on Father's Day weekend when he discovered Caroline violated their agreement that the children not be in contact with their grandparents. Furthermore, it is undisputed that at the time of her last observations of Trent's parenting, he was the COO of a major corporation, while Caroline, a former teacher, was the primary caretaker of the children at the time.

Despite the aforementioned evidence, in response to questions by the amicus attorney concerning whether Trent had any redeemable qualities, Caroline testified that Trent has many good qualities as a father. She agreed with how he parents their children, disciplines them, teaches them, brings them up religiously, provides for them, and how he drives with them in his vehicle. Caroline testified that during his periods of possession, Trent “is perfectly capable of caring for the mental, physical, and emotional needs” of their children. Caroline also ultimately admitted she did not believe their children were in danger when Trent had them. She agreed that after she left him, Trent improved in his caregiving of the kids. She testified Trent has a “different dynamic” from her that is good for their kids.

In response to the same question, Trent testified that Caroline was extremely loving and affectionate towards the children, and that she had many admirable qualities as a mother, namely through her training and education as a teacher. He further related that she had special skills in the development of children. Trent also testified that he envies her strong relationship with her family and the tight knit nature of their family unit. He remarked that it is evident that Caroline's family all love and support each other very much, which he testified contrasted with his own family dynamics.

Discussion

It is undisputed that the children have more resources than most other children, and that they are surrounded by many people that greatly care for them and are devoted to their successful rearing. Importantly, after the presentation of all the evidence, the amicus attorney argued that the single greatest risk of impediment to the children's positive development is Caroline's and Trent's relationship in coparenting them given the evidence presented at trial. The trial court clearly agreed, as do we. The children's teachers, school administrators, and counselors all testified that the children are very bright, polite, considerate, well-mannered, and have great personalities. The record reflects that the children have many friendships and a very robust support structure at All Saints and with their other family members.

The trial court also heard evidence that although the children initially struggled in transitioning and disruptions in their routine after Caroline filed for divorce, they all adjusted well and continue to thrive at All Saints. Caroline testified that their coparenting improved, and she hopes they can coparent more effectively in the future. The amicus attorney had his reservations, because even during the same month as the trial, Caroline took the children on an extended weekend trip without disclosing it to Trent.

A trial court can deviate from the standard possession order if special circumstances make the standard order “unworkable or inappropriate” and may consider a variety of facts in doing so. Tex. Fam. Code Ann. §§ 153.253, 153.256. Considering this record, given the angst between Trent and Caroline, we cannot conclude that the trial court abused its discretion, of which it had wide latitude, when it ordered a 50/50 alternating weekly possession schedule. See e.g., In re A.D., 474 S.W.3d 715, 725 (Tex. App.—Houston [14th Dist.] 2014, no pet.) (deviating from standard order was justified because the mother “and her family doggedly perpetuated [false] accusations [against the father] over a year-a-half period, although authorities and professionals in multiple counties determined they were unfounded”). It is reasonable in light of the evidence that such a schedule provides the best chance to minimize the single greatest risk to the children—the relationship between their parents—and serves in their best interest. Caroline's eighth issue is overruled.

Voltrona Interests, LLC

In her second issue, Caroline argues that the trial court erred in granting Trent's separate property estate a $950,0000 reimbursement claim to be paid from community property sale proceeds.

Standard of Review

We review a trial court's division of property under the abuse of discretion standard. See Murff v. Murff, 615 S.W.2d 696, 98 (Tex. 1981). Additionally, when considering an alleged property characterization error, as is the case here, the reviewing court must determine whether the mischaracterization caused the trial court to abuse its discretion. Boyd v. Boyd, 131 S.W.3d 605, 617 (Tex. App.—Fort Worth 2004, no pet.). Thus, first, the appellant must prove a mischaracterization of assets, and second, she must show resulting harm. See Tex. R. App. P. 44.1(a)(1). If the mischaracterization has a mere de minimus effect on the division of the community estate, the trial court did not abuse its discretion. Boyd, 131 S.W.3d at 617; see also In re Marriage of Morris, 12 S.W.3d at 884 (mere mischaracterization of separate property as community property does not require reversal unless appellant proves a resulting disparity in the property division that is substantial enough that it constitutes an abuse of the trial court's discretion); Magill v. Magill, 816 S.W.2d 530, 533 (Tex. App.—Houston [1st Dist.] 1991, writ denied).

Community and Separate Property

Separate property encompasses “all property of a spouse owned or claimed before marriage, or property acquired during marriage by gift, devise, or descent.” Tex. Const. Art. XVI, § 15. Community property consists of all property, other than separate property, acquired by either spouse during marriage. Tex. Fam. Code Ann. § 3.002.

Property possessed by either spouse during or on dissolution of marriage is presumed community property. Id. § 3.003. This presumption can be rebutted only by clear and convincing evidence, with the burden of proof falling to the spouse asserting separate characterization. Id. “Clear and convincing evidence” means the measure or degree of proof that 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. Id. § 101.007. When the burden of proof at trial is by clear and convincing evidence, we must apply a higher standard of legal and factual sufficiency review. See In re J.F.C., 96 S.W.3d 256, 265-66 (Tex. 2002).

To overcome the community presumption, the spouse claiming separate property must trace and clearly identify the property claimed to be separate. See Estate of Hanau v. Hanau, 730 S.W.2d 663, 667 (Tex. 1987) (citing Tarver v. Tarver, 394 S.W.2d 780, 783 (Tex. 1965)). This is a heavy burden. Latham v. Allison, 560 S.W.2d 481, 484 (Tex. Civ. App.—Fort Worth 1977, writ ref'd n.r.e.).

Characterization of Interest in Business Entities

The characterization of property as either community or separate is determined by the inception of title to the property. Barnett v. Barnett, 67 S.W.3d 107, 111 (Tex. 2001). Inception of title occurs when a party first has a right of claim to the property by virtue of which title is finally vested. Boyd, 131 S.W.3d at 612. Thus, if a party owns an interest in an entity before marriage, the interest would be separate property. Harris v. Harris, 765 S.W.2d 798, 803 (Tex. App.—Houston [14th Dist.] 1989, writ denied). It is only the entity interest held by an owner that is subject to a community or separate property characterization. See Marshall v. Marshall, 735 S.W.2d 587, 594 (Tex. App.—Dallas 1987, writ ref'd n.r.e.). On the other hand, an entity's assets, including undistributed income and profits, are the entity's property and do not take on any separate or community-property character. See Harris, 765 S.W.2d at 802.

Distributions from LLC's

“Membership interest” means in pertinent part a member's interest in an entity. Tex. Bus. Orgs. Code Ann. § 1.002(54). With respect to an LLC, the term includes a member's share of profits and losses or similar items and the right to receive distributions.²¹ Id. A member of an LLC is entitled to receive or demand a distribution from the company only in the form of cash, regardless of the form of the member's contribution to the company. Id. § 101.202. “Distribution” in LLC's do not include an amount constituting reasonable compensation for present or past services or a reasonable payment made in the ordinary course of business under a bona fide retirement plan or other benefits program. Id. § 101.206(f). Subject to limitations on distributions, when a member is entitled to receive a distribution from the company, the member, with respect to the distribution, has the same status as a creditor of the company and is entitled to any remedy available to a creditor of the company. Id. § 101.205.

A member of an LLC, before the winding up of the company, is not entitled to receive and may not demand a distribution from the company until the company's governing authority declares a distribution to: (1) each member of the company; or (2) a class or group of members that includes the member. Id. § 101.204. A member of an LLC who validly exercises the member's right to withdraw from the company granted under the operating agreement is entitled to receive, within a reasonable time after the date of withdrawal, the fair value of the member's interest in the company as determined as of the date of withdrawal. Id. § 101.205.

“[T]he assets of a limited liability company include the fair value of [its] property ” Id. § 101.206(c). The fair value of the company's assets may be based on, among other things, financial statements of the company consistent with generally accepted accounting principles or international financial reporting standards, other similar financial information made under similar standards, projections on the company's financial condition or liquidity of the company that are reasonable under the circumstances, fair valuations from other reasonable methods under the circumstances, or a combination thereof. See id. § 101.206(c-1).

Cash Distributions

Cash dividends from stock are treated like income, and when distributed during marriage are community property. Legrand-Brock v. Brock, 246 S.W.3d 318, 322 (Tex. App.—Beaumont 2008, pet. denied). A distribution by a corporation to its shareholders may constitute a dividend in law even though not formally designated as a dividend by the board of directors. Id. at 322. A liquidating distribution, on the other hand, includes a transfer of money by a corporation to its shareholders in liquidation of all or a portion of its assets. See id.; see also Black Law's Dictionary 597 (12th ed. 2024) (A “liquidating distribution” is “[a] distribution of trade or business assets by a dissolving corporation or partnership.”).

Discussion

As we mentioned earlier, TDB LLC is an entity formed by Trent prior to the marriage, and his membership in the entity is clearly his separate property. Bailes identified this entity as an asset protection device. It neither makes products nor provides services to anyone. Instead, Trent uses it to hold and transfer other assets from time to time. Pertinent to this issue, Trent transferred BGC stock to TDB LLC. Once Trent transferred the BGC stock to his separate property entity, TDB LLC, it became the property of TDB LLC., and it lost its characterization as either community or separate property upon transfer.

We start with the community presumption, and it was Trent's burden to prove by clear and convincing evidence that these transactions are simply a mutation of his separate property that retained separate status. The financial experts agree that Texas follows the entity theory and that tracing through the entity is not possible. Consistent with this conclusion, as we mentioned, when property is conveyed to an entity, that property becomes the property of the entity and does not retain its character as either separate or community property. In re Marriage of Nash, 644 S.W.3d 683, 708 (Tex. App.—Texarkana 2022, no pet.). Therefore, a spouse cannot trace his separate property ownership of the stock through its transfer to a business entity, because upon its transfer, he no longer held an ownership interest in the stock. See Lifshutz v. Lifshutz, 199 S.W.3d 9, 27 (Tex. App.—San Antonio 2006, pet. denied) (“When an individual partner contributes property into a partnership, the partner loses individual interest in the property and, since the partnership itself is the new owner, the property can no longer be classified as separate or community.”); Marshall, 735 S.W.2d at 594 (“[A] withdrawal from a partnership capital account is not a return of capital in the sense that it may be characterized as a mutation of a partner's separate property contribution to the partnership and thereby remain separate. Such characterization is contrary to the [the Business Organizations Code and improperly] implies that the partner retains an ownership interest in his capital contribution.”). “This is true even if property that was separate when transferred into an entity is subsequently returned.” Matter of Marriage of Thatcher, No. 07-25-00011-CV, 2025 WL 2396576, at *4 (Tex. App.—Amarillo Aug. 18, 2025, no pet.) (mem. op.).

This same logic applies to property transferred to an LLC. See, e.g., Mason v. Mason, No. 03-17-00546-CV, 2019 WL 1967166 at *6, (Tex. App.—Austin May 3, 2019, no pet.) (mem. op.) (“when the funds were transferred from [the couple's] community estate to [an LLC], the funds lost their community character and became the property of the LLC”); In re Marriage of Hudson, No. 06-18-00011-CV, 2018 WL 4656288 at *3 (Tex. App.—Texarkana Sep. 28, 2018, no pet.) (mem. op.) (explaining that when property is conveyed to business entity, “such as a partnership or limited liability company, it becomes the property of the entity and loses its separate or community character”). Once the LLC sold the BGC stock, converted it to cash, and Trent directed the cash proceeds to be deposited into Voltrona's bank account, it is best characterized as a distribution from TDB LLC to Trent, who is apparently its sole member. See Tex. Bus. Orgs. Code Ann. § 101.202.

This does not end our inquiry, however. Texas courts sometimes recognize that a distribution from an entity such as an LLC can be categorized as a “liquidating distribution,” which allows the distribution to retain separate property status in certain circumstances. The leading case on this doctrine is LeGrand-Brock v. Brock. See generally 246 S.W.3d at 321-24. In Legrand, husband entered the marriage with separate property stock in BTH Holdings (BTH). Id. at 320. Roughly one month later, BTH's board passed a resolution to dissolve BTH and distribute its assets pursuant to a plan of liquidation. Id. The plan required the officers to pay all BTH's outstanding debts, and to distribute pro rata all remaining assets to the shareholders in cancellation of all their shares. Id. Between the February 1999 resolution and November 2001, BTH made four cash distributions to the husband for several million dollars. Id. A certificate of dissolution was issued on October 31, 2001. Id. The wife filed for divorce approximately a year later. Id.

At trial, wife's accounting expert testified the distributions were dividends that should be characterized as community property. Id. The trial court disagreed, ruling that the payouts were liquidating distributions because they were made under a dissolution plan, and ultimately were consideration for the cancellation of husband's separate-property stock in BTH. Id. The Beaumont Court of Appeals agreed, holding that the distributions were under a preexisting corporate dissolution plan, satisfied a board resolution requiring BTH to distribute its assets to its shareholders in cancellation of the company's capital stock, and facilitated the company's actual dissolution. Id. at 322. So, the distributions were not “dividends” at all but replaced husband's separate-property stock, affording them the same separate-property character. Id.

“Generally, when a spouse owns separate-property stock in a dissolving corporation and receives distributions of liquidated assets, the distributions remain the stockholder's separate property.” Id. at 321 (citing Fuhrman v. Fuhrman, 302 S.W.2d 205, 212 (Tex. Civ. App.—El Paso 1957, writ dism'd) (stock received in liquidation of a corporation in which husband had owned separate-property stock was likewise husband's separate property)); Wells v. Hiskett, 288 S.W.2d 257, 265 (Tex. Civ. App.—Texarkana 1956, writ ref'd n.r.e.) (because stockholder had received the subject oil-and-gas lease as a liquidating distribution in consideration of cancelling his shares in the dissolving corporation, the lease remained his separate property as a matter of law). In such an instance, the character of separate property is not altered by the sale, substitution, or exchange of the property; separate property that merely undergoes mutations or changes in form remains separate property. See Legrand, 246 S.W.3d at 321; Harris, 765 S.W.2d at 802.

This case is distinguishable from Legrand. Trent admitted he did not cease operating the LLC in 2015, terminate his LLC registration with the Secretary of State, or enter any articles of dissolution. In fact, TDB LLC continued to operate, and have funds deposited and withdrawn, even years later, such as with the December 2021 BGC stock sales he deposited into his bank account.

The only other evidence the trial court heard on this issue was from the two financial experts, both of whom supported Caroline's contention that there was no liquidation of TDB LLC. Bailes, for example, testified that at no time after the stock sale in May 2015 was there any redemption of Trent's membership in the LLC, and further testified that the LLC did not close its doors after the stock sale in May 2015. Additionally, Bailes testified that no one provided him with any information that the LLC was presently in the process of terminating operations or attempted to liquidate all or a portion of its assets at any other time since the December 2021 BGC stock transactions. Simply stated, the transaction was not liquidating because Trent did not meet his burden by clear and convincing evidence to show the distribution was in cancellation of Trent's interest in TDB LLC, the owner of the Brookshire's stock asset it sold to finance the ranch purchase. See Matter of Marriage of Thatcher, 2025 WL 2396576, at *4 n.9 (distinguishing LeGrand and holding that even if spouse retained stock in company, distribution was not liquidation because transaction not made in cancellation of interest in business).²²

In support of his position, Trent cites In re Marriage of Grisham, which involved an exchange of assets where the husband exchanged his shares in a separate property company for a newly formed company. In re Marriage of Grisham, No. 10-09-00429-CV, 2010 WL 4570266, at *1 (Tex. App.—Waco 2010, pet. denied.). Because the husband never received any money or property in exchange for his interests in the two businesses, the Waco Court of Appeals found the exchange of shares to be a mutation.²³ Id. In contrast, Trent did not exchange his TDB LLC shares for his interest in Voltrona. Instead, Trent as the sole member of TDB LLC, directed the cash distribution from the BGC stock sale to himself, which he then used as a downpayment for Voltrona's acquisition of a ranch. TDB LLC has never been wound down, nor has Trent exchanged his interest in the LLC for anything else.

There was no clear and convincing proof that the distribution was some kind of “exchange” or “mutation.” Instead, Trent admitted he did not tender any of his membership interest back to TDB LLC in exchange for his receipt of these monies. Accordingly, the transaction was a distribution of income, not an exchange or mutation. In summary, we hold that Trent failed to discharge his burden, to prove by clear and convincing evidence, that the BGC stock transfer to TDB LLC, subsequent conversion to cash, and distribution he received and directed to be deposited into Voltrona's account to be used as the ranch downpayment, retained separate property status.

Finally, with respect to this issue, Trent makes two new alternative arguments for the first time in his brief that he never raised to the trial court. As a general principle, it is often stated that we may affirm the trial court's order if it is correct on any legal theory applicable to the case. A more complete statement of the rule is that “[w]e must uphold a lower court judgment on any legal theory before it, even if the court gives an incorrect reason for its judgment.” Victoria Gardens of Frisco v. Walrath, 257 S.W.3d 284, 290 (Tex. App.—Dallas 2008, pet. denied); see also Guar. Cnty. Mut. Ins. Co. v. Reyna, 709 S.W.2d 647, 648 (Tex. 1986). Stated another way, “we will not affirm the trial court's order based on a legal theory not presented to the trial court and to which [Caroline] had no opportunity to respond.”²⁴ See Victoria Gardens, 257 S.W.3d at 290; Villarreal v. Villarreal, No. 04-15-00551-CV, 2016 WL 4124067, at *2 (Tex. App.—San Antonio Aug. 3, 2016, no pet.) (mem. op.) (“With regard to the alternative legal theories advanced by [wife] in her brief, we agree with [husband] that the trial court's order can only be upheld based on the legal theories that were before the court at the time of the hearing.”). It is apparent from the record that the parties raised only the liquidating distribution argument under LeGrand, and the trial court had no other theory before it when it resolved this issue. Accordingly, we do not address Trent's alternative arguments raised for the first time in his appellate brief to support his theory that the funds at issue are his separate property.

The trial court's $950,000 characterization error concerns a substantial asset and thus it cannot be harmless. See Boyd, 131 S.W.3d at 617; see also In re Marriage of Morris, 12 S.W.3d at 884. Accordingly, we must conclude that the trial court abused its discretion in the mischaracterization of the payment as Trent's separate property. Caroline's second issue is sustained.

Vanguard Account

In her third issue, Caroline argues that the trial court erred in confirming $1.2 million in Trent's Vanguard account as separate property when the funds came from a community property distribution.

Bailes testified that on December 8, 2021, the LLC sold $444,450 of BGC stock, and Trent individually sold $1,513,085.58 in other, individually-owned BGC stock, all of which was his separate property at the time. However, as with the Voltrona ranch downpayment, Trent deposited both checks from these stock sales into TDB LLC's bank account on December 13.²⁵ Thus, all proceeds from all December 8 BGC stock sales became TDB LLC assets. See Harris, 765 S.W.2d at 802.

In the following weeks, virtually all funds were transferred from the LLC account and distributed into two investment accounts, one at Vanguard, and one at TD Ameritrade, once again leaving a de minimis balance in the LLC's bank account of $528.32 at the end of January 2022. The TD Ameritrade account and the Vanguard account were both titled in Trent's individual name. At the time of trial, the Vanguard account contained about $1.7 million. Caroline contended that all funds in the Vanguard account were community property as of trial, whereas Trent claimed that about $1.2 million of the account was his separate property. He argued that the December 2021 funds transfer from the LLC to the Vanguard account was a liquidating distribution, and therefore, the funds going into the Vanguard account assumed the same character as the separate-property LLC supposedly being liquidated. This is the same legal argument Trent made respecting the $950,000 ranch down payment. As with that issue, this argument fails because Trent provided no evidence that TDB LLC, was planning dissolution, winding up, or being liquidated. See Matter of Marriage of Thatcher, 2025 WL 2396576, at *4 n.9 (distinguishing LeGrand and holding that distribution was not liquidation because transaction not made in cancellation of interest in business).

Bailes did not render an opinion on the parties' legal positions. But he did agree that if Caroline is correct about the distributions from TDB LLC being community property, then the entire Vanguard account would be community property. But if Trent was correct that the funds transferred out of the LLC were somehow part of a winding up of the entity, then $1,206,510.77 would be his separate property and $545,641.69 would be community property.

Even after the December 2021 BGC stock transactions, TDB LLC did not cease operation. Trent did not tender any of his membership interest back to the LLC in exchange for his receipt of any monies. Both before and after these stock transactions, hundreds of thousands of dollars of community funds flowed into that same TDB LLC account. The burden of proof is on Trent to prove by clear and convincing evidence that the Vanguard funds are his separate property. See Tex. Fam. Code Ann. § 3.003. As with the Voltrona ranch downpayment, Trent failed to satisfy this duty when he admitted he had not dissolved TDB LLC.

The trial court's $1.2 million characterization error concerns a substantial asset and thus it cannot be harmless. See Boyd, 131 S.W.3d at 617; see also In re Marriage of Morris, 12 S.W.3d at 884. Accordingly, we must hold that the trial court abused its discretion when it mischaracterized $1.2 million in funds as Trent's separate property. Instead, the entire $1.7 million is part of the community estate. Caroline's third issue is sustained.

Trent's Employment Suit Against BGC

Caroline argues in her fourth issue that the trial court failed to divide the community estate in a just and right manner when it awarded Trent 100% of his expected recovery from an employment suit when all parties agreed the suit included a substantial community property claim.

Standard of Review

As with the other property division issues raised by Caroline, we review this issue under an abuse of discretion standard. Murff, 615 S.W.2d at 698. In a divorce proceeding, a court must divide a marital estate in a “just and right” manner. Tex. Fam. Code Ann. § 7.001. In doing so, the court may consider factors including the nature of the marital property; relative earning capacity and business opportunities of the parties; the parties' relative financial condition and obligations; the size of the separate estates; fault in breaking up the marriage; the benefit the innocent spouse would have received had the marriage continued; and the probable need for future support. Murff, 615 S.W.2d at 699. If an appellate court determines that a trial court's division of property in a divorce was so unjust and unfair as to constitute an abuse of discretion, it must reverse. Id. at 698.

Applicable Law

Whether property belongs to the community estate is determined by the property's character at the time of inception. In re Marriage of Nash, 644 S.W.3d 683, 696 (Tex. App.—Texarkana 2022, no pet.) (citing Barnett, 67 S.W.3d at 111). “Inception” occurs when a party first has a right of claim to the property. McClary v. Thompson, 65 S.W.3d 829, 834 (Tex. App.—Fort Worth 2002, pet. denied). Property acquired during marriage is characterized as community property if it is not acquired as recovery for personal injuries or by gift, devise, or descent. Tex. Fam. Code Ann. § 3.002. This includes property and earnings earned during the pendency of divorce proceedings. In re Marriage of O'Brien, 436 S.W.3d 78, 84 (Tex .App.—Houston [14th Dist.] 2014, no pet.). For a party to prove property acquired after marriage is separate property, he must prove its separate character by clear and convincing evidence. Tex. Fam. Code Ann. § 3.003(b).

In Texas, courts may find certain assets earned during the marriage to be community property—and divide them between the parties—even though the spouse who earned the assets has not yet received them. See, e.g., Cearley v. Cearley, 544 S.W.2d 661, 663–66 (Tex. 1976) (dividing community asset “which may or may not bloom into full maturity at some future date.”). We have expressly stated that “[d]amages for lost wages and diminished earning capacity are community property.” Henslee v. Henslee, No. 12-09-00274-CV, 2010 WL 2982928, at *3 (Tex. App.—Tyler 2010, no pet.) (mem. op.); see also Cottone v. Cottone, 122 S.W.3d 211, 213 (Tex. App.—Houston [1st Dist.] 2003, no pet.). The Family Code likewise characterizes “loss of earning capacity during marriage” as community property. Tex. Fam. Code Ann. § 3.001(3).

Discussion

It is our understanding that the majority of the damages sought in Trent's wrongful termination suit represent his lost wages or loss of earning capacity. Caroline contends that she is entitled to her community share of any lost wages or lost earning capacity Trent might recover in his suit from the date of his termination in October 2021 through the date of divorce in March 2024, less expenses incurred by Trent from his separate estate such as attorney's fees and other costs. The trial court apportioned no dollar amount or percentage of any potential recovery to Caroline.

In Von Hohn v. Von Hohn, we held in pertinent part that the trial court erred when it considered the expectancy value of a law firm partner's interest in the firm for the potential settlement value of cases he worked on, but had not yet settled, as of the date of divorce. Von Hohn v. Von Hohn, 260 S.W.3d 631, 642 (Tex. App.—Tyler 2008, no pet.). This case is distinguishable. In Von Hohn, the lawsuits were not the husband's personal claims. Rather, they were claims he worked on in his capacity as attorney on behalf of his clients to compensate them for their injuries. See id. We also noted that any settlements were a mere expectancy interest. Consequently, we explained that the claims were pending, unsettled, and unearned at the time of divorce, and would come from future earnings of which the trial court could not include in the community estate for division. See id.

Here, in contrast, this lawsuit is for injuries suffered personally by Trent, and the nature of the remedy sought, at least as pertinent to this appeal, is Trent's lost wages. Any pertinent recovery here for lost wages incurred during the marriage is undoubtedly a community asset. Tex. Fam. Code Ann. § 3.001(3); Osborn v. Osborn, 961 S.W.2d 408, 414 (Tex. App.—Houston [1st Dist.] 1997, pet. denied); Henslee, 2010 WL 2982928, at *3. The nature of the remedy and recovery, lost wages, essentially relates back to the time period in which he suffered the injury during marriage through the date of divorce. In other words, in Von Hohn, the value of his interest in the law firm did not include the expectancy value of unearned speculative income for settlements that may or may not come to fruition in his clients' cases. In contrast, here, the future recovery of lost wages is fundamentally different in that it is a community asset for compensation Trent might receive at a later date that relates back to the date it would have been incurred during the marriage had he not been wrongfully terminated. See Rice v. Rice, No. 02-21-00413-CV, 2023 WL 109817, at *10-12 (Tex. App.—Fort Worth Jan. 5, 2023, no pet.) (mem. op.) (holding portion of husband's pending personal injury lawsuit for lost wages incurred during marriage is community property, and it may be proportionally divided, even though case not yet settled or successful at trial).²⁶

The trial court has wide discretion in making a just and right division of the community property estate. It is clear from this record that Caroline has a community interest in any portion of the recovery representing lost wages or lost earning capacity that would have been earned, but not yet received, during the marriage, through the date of divorce. See id. Whatever the value, if any, the suit ultimately yields, her percentage is not zero, which is what the trial court found.

Consistent with Rice, as Caroline proposed in Exhibit CB-M8, in such a circumstance, a contingent percentage split is one appropriate means to divide her portion of this asset—the trial court can order in the divorce decree that if the lawsuit is successful, the net proceeds (the total award minus attorney fees and court costs expended by Trent) will be split between the spouses by a specific percentage (e.g., 50/50 or some other percentage the trial court deems just and right in its discretion) for the portion representing lost wages incurred during that marriage. See id.

In summary, we must conclude that the trial court abused its discretion on this claim. In light of our disposition of this issue and the other marital property issues, we remand this claim for a redetermination of a just and right division of the marital estate.

Caroline's fourth issue is sustained.

Economic Waste Claim

Caroline contends in her sixth issue that the trial court erred in denying her waste claim relating to attorney's fees allegedly paid by the community estate in pursing Trent's invasion of privacy and wiretapping suit against her.

Applicable Law

Waste occurs when a spouse, without the other spouse's consent, wrongfully depletes community assets. Schlueter v. Schlueter, 975 S.W.2d 584, 589 (Tex. 1998). Because claims for waste belong to the community, “they must be included in the trial court's just-and-right division of community property upon divorce.” Chu v. Hong, 249 S.W.3d 441, 444-45 (Tex. 2008). Excess spending by one spouse on attorney's fees can be waste. See Graves v. Tomlinson, 329 S.W.3d 128, 151 (Tex. App.—Houston [14th Dist.] 2010, pet. denied); Matter of Marriage of Walzel, No. 14-16-00637-CV, 2018 WL 614767 at *4 (Tex. App.—Houston [14th Dist.] Jan. 30, 2018, no pet.) (mem. op.). Additionally, debt created during marriage is presumed to be community debt, paid with community funds. See Cockerham v. Cockerham, 527 S.W.2d 162, 171 (Tex. 1975).

Additionally, in a waste claim, a “presumption of constructive fraud arises where one spouse disposes of the other spouse's one-half interest in community property without the spouse's knowledge or consent.” Wheeling v. Wheeling, 546 S.W.3d 216, 225 (Tex. App.—El Paso 2017, no pet.). Once the presumption of constructive fraud arises, the burden of proof shifts to Trent to prove the fairness of the disposition of the other spouse's one-half community ownership. See id. Only after evidence contradicting the presumption is produced does the presumption disappear and place the burden of proof once again on the petitioner. Clarke v. Clarke, No. 08-23-00016-CV, 2024 WL 347938, at *7 (Tex. App.—El Paso Jan. 30, 2024, no pet.) (mem. op.).

Tracing involves establishing the separate origin of the property through evidence showing the time and means by which the spouse originally obtained possession of the property. Smith v. Smith, 22 S.W.3d 140, 144 (Tex. App.—Houston [14th Dist.] 2000, no pet.) (op. on reh'g). As a general rule, the clear and convincing standard is not satisfied by testimony that property possessed at the time the marriage is dissolved is separate property when that testimony is contradicted or unsupported by documentary evidence tracing the asserted separate nature of the property. Cotton v. Cotton, No. 12-16-00279-CV, 2017 WL 6523098, at *3 (Tex. App.—Tyler Dec. 21, 2017, no pet.) (mem. op.) (citing Graves, 329 S.W.3d at 139). In the absence of clear and convincing evidence, such as documentary evidence tracing these funds, the community presumption applies. See Boyd, 131 S.W.3d at 612 (“any doubt as to the character of property should be resolved in favor of the community estate”).

Discussion

Caroline argues Trent wasted approximately $340,000 in community funds by paying lawyers to pursue a lawsuit alleging wiretapping and invasion of privacy claims against her when she accessed and saved recorded videos from the nanny cameras inside the family home after she moved out and filed for divorce.

The trial court irrefutably concluded that the expenditure of approximately $340,000 in attorney's fees was unreasonable, as did Cheryl Wulf, the attorney's fee expert who testified in this case. We agree with the conclusion of the trial court that the fees were unreasonable and support a waste claim. Neither party challenges this finding on appeal.

However, the trial court noted at several points that it recalled from the evidence that Trent expended only separate property funds to prosecute his invasion of privacy and wiretapping claims. It was Trent's burden to establish the separate property status of these funds by clear and convincing evidence. At most, the only evidence supporting this conclusion is Trent's bare testimony implying that he used separate funds to pay his attorneys for the wiretapping suit. Caroline was unsure how Trent paid his attorneys for these claims.²⁷

Trent made no attempt to trace or otherwise show the separate property character of the funds, and we are unable to discern from this voluminous record the source and nature of the funds used to pay the attorney's fees he expended for these claims. Trent apparently claims that he used funds in the TD Ameritrade account to finance the litigation. However, we already determined that he did not show the separate property status of the funds in this account. Moreover, it is undisputed that he frequently deposited community funds in the account. He made no attempt to show that the funds were separate. We do not have a firm conviction or belief that Trent's bare testimony that the funds were separate supports the trial court's finding in this regard. See Cotton, 2017 WL 6523098, at *3. Furthermore, Trent offered no evidence that this was a fair disposition of Caroline's interest in the community estate. See Wheeling, 546 S.W.3d at 225. In this circumstance, we are left with the community property presumption and constructive fraud on the community presumption, both of which Trent failed to rebut. See Boyd, 131 S.W.3d at 612. Accordingly, we must hold that the trial court abused its discretion when it denied Caroline's economic waste claim.

Caroline's sixth issue is sustained.

Capital Gains Tax

In her seventh issue, Caroline contends the trial court erred in denying the community estate a $225,487 reimbursement claim for capital gain taxes the community paid on Trent's sale of separate property BGC stock.

Reimbursement Claims

During the pendency of the suit, the Texas Family Code was amended to state that reimbursement claims “exist when one or both spouses use property of one marital estate to confer on the property of another marital estate a benefit which, if not repaid, would result in unjust enrichment to the benefited estate.” Tex. Fam. Code Ann. § 3.402(a). The legislature intended that the new reimbursement statute would apply retroactively to cases, like the present case, pending as of September 1, 2023.²⁸ Under the current statute, a spouse seeking reimbursement to a marital estate must prove: (1) that the spouse or both spouses used property of the marital estate to confer a benefit on the property of another marital estate; (2) the value of the benefit described by Subdivision (1); and (3) that unjust enrichment of the benefited estate will occur if the benefited estate is not required to reimburse the conferring estate. Id. § 3.402(b). Because reimbursement is an equitable claim, a court is “bound to look at all the facts and circumstances and determine what is fair, just, and equitable.” Penick v. Penick, 783 S.W.2d 194, 197 (Tex. 1988).

Capital Gains Taxes

Separate property capital gains are treated differently than income generated by separate property. While the latter income always is community property, separate property capital gains retain their separate property characterization. Cf. Jensen v. Jensen, 665 S.W.2d 107, 109 (Tex. 1984) (“The [‘]reimbursement['] theory provides that the stock, as it appreciates, remains the separate property of the owner spouse.”); LeGrand, 246 S.W.3d at 322. Said another way, any increase in value of separate property from market fluctuations remains separate property. See Dillingham v. Dillingham, 434 S.W.2d 459, 461–62 (Tex. Civ. App.—Fort Worth 1968, writ dism'd). Further, the mutation principle holds that proceeds from the sale of separate property—including principal, capital gains, and assets bought with those gains—remain separate property. Bakken v. Bakken, 503 S.W.2d 315, 317-18 (Tex. App.—Dallas 1973, no writ).

Discussion

The parties' community estate paid $225,487 capital gains tax debt created when Trent sold his separate property stock in 2021. It is important to note that capital gains taxes were realized when Trent sold his separate property stock. Payment of this separate estate debt reduced the community estate dollar for dollar, triggering the reimbursement statute. See Tex. Fam. Code. Ann. § 3.402. Because capital gains on separate property are still separate property, it is inequitable to force the community to suffer for Trent's separate benefit. See Penick, 783 S.W.2d at 196; Jensen, 665 S.W.2d at 109. If that benefit is not repaid, it would unjustly enrich Trent's separate property estate. See Tex. Fam. Code. Ann. § 3.402.

Therefore, we hold that the trial court abused its discretion when it denied Caroline's reimbursement claim for the capital gains taxes on the sale of Trent's separate property stock.

Caroline's seventh issue is sustained.

Caroline's Attorney's Fees

In her fifth issue, Caroline argues the trial court erred in refusing to recognize promissory notes executed by her and her father solely for the purpose of paying her attorney's fees and legal costs when the notes are community obligations, and the evidence of such notes was undisputed.

Applicable Law

Unless it is shown that the creditor agreed to look solely to the separate estate of the contracting spouse for satisfaction, debts contracted during a marriage are presumed to be on the credit of the community and thus are joint community obligations. Cockerham, 527 S.W.2d at 171. Likewise, a loan created during marriage is presumed to be community debt, and to rebut this presumption, the party claiming otherwise must prove by clear and convincing evidence that the creditor agreed to look solely to the separate estate of the contracting spouse. Sprick v. Sprick, 25 S.W.3d 7, 13 (Tex. App.—El Paso 1999, pet. denied).

However, despite these general rules, “[i]n a suit for dissolution of a marriage, the [trial] court may award reasonable and necessary attorney's fees, court costs, and expenses.” Tex. Fam. Code Ann. § 6.708(c). We review a trial court's decision to award attorney's fees for an abuse of discretion. Bocquet v. Herring, 972 S.W.2d 19, 21 (Tex. 1998). Further, the trial court has the equitable power to award either spouse attorney's fees as part of the just and right division of the marital estate. See Miles v. Miles, No. 05-24-00018-CV, 2025 WL 3241330, at *13 (Tex. App.—Dallas Nov. 19, 2025, pet. denied) (mem. op. on reh'g). A trial court does not abuse its discretion in ordering each party to pay their own attorney's fees as part of a just and right division. See Mandell v. Mandell, 310 S.W.3d 531, 542 (Tex. App.—Fort Worth 2010, pet. denied).

Discussion

During the marriage, Caroline executed promissory notes to her father, with a balance of $311,987 at the time of trial.²⁹ Caroline asks us to focus on the fact that these promissory notes relate to debt she made during the marriage, and as such, are community debts. However, she fails to recognize what the promissory notes represent, which is wholly to repay her father for advancing cash to pay her attorney's fees she accrued in this divorce action. This fact was undisputed at trial.

Both Trent and Caroline played a significant role in the high cost of this divorce case. Both parties were successful on different issues litigated at trial, along with the issues raised in this appeal. It is undisputed that the entirety of the promissory notes relate solely to amounts Caroline borrowed from her father to pay her attorney's fees and costs in this divorce. In light of these facts, we cannot conclude on this record that the trial court abused its discretion in ordering each party to pay their own attorney's fees as part of a just and right division of the marital estate, irrespective of the fact that Caroline's sole source of the funds came from promissory notes she executed during the marriage. See Mora v. Mora, No. 04-12-00638-CV, 2014 WL 769441, at *9 (Tex. App.—San Antonio Feb. 26, 2014, no pet.) (mem. op.) (holding trial court did not abuse discretion in ordering both parties to bear own attorney's fees even though wife was medically disabled and had great difficulty in obtaining proportionate division, because wife was awarded significant cash as part of community estate to pay fees and had separate property as well); In re O.N.L., No. 04-02-00773-CV, 2003 WL 22295306, at *2 (Tex. App.—San Antonio Oct. 8 2003, pet. denied) (mem. op.) (citing Bruni v. Bruni, 924 S.W.2d 366, 368 (Tex. 1996)).

Caroline's fifth issue is overruled.

Disposition

We overruled Caroline's first, fifth, and eighth issues. We sustained her second, third, fourth, sixth, and seventh issues.

Therefore, we reverse the portion of the final decree of divorce concerning its disposition of the following assets and liabilities: Voltrona's ranch property, the Vanguard bank account, Trent's employment suit against BGC, Caroline's waste claim for Trent's wiretapping and invasion of privacy suit attorney's fees, and capital gains taxes paid by the community estate for Trent's 2021 BGC stock sales of separate property stock, and remand for a new just and right property division consistent with this opinion. We affirm the remainder of the trial court's final decree of divorce.

FOOTNOTES

2.   On March 14, 2014, the couple held a ceremony in Italy to “celebrate the religious part of it.”

3.   The trial court rounded this claim to $842,000.00 in the divorce decree.

4.   The trial court appointed a receiver, who sold the ranch during the pendency of this appeal. The court distributed the proceeds as follows: $2,784,156 to Trent and $1,824,156 to Caroline.

5.   The trial court also made slight adjustments to the amicus attorney's recommended 50/50 alternating possession schedule. For example, the trial court ordered that the possession for each spouse begin on each Monday in light of the fact that the children often take extended weekend trips.

6.   One officer's body camera exhibit was never admitted into evidence.

7.   Caroline, in her brief, identifies several alleged poor parental choices and bad actions by Trent that range from neglecting the children to physical and sexual assaults against her. But she did not explain her own poor choices in her brief.

8.   Per the parties' premarital agreement, this home was Trent's separate property, but Caroline acquired an interest upon being married for five years. Trent conveyed a 50% interest in it to Caroline. The house was later sold after Caroline filed for divorce. Caroline and Trent each received about $512,000 from the sale.

9.   The trial court also heard evidence that Trent and his parents had a tumultuous relationship in the past related to incidents when he was a teenager that ultimately precipitated them sending him to what he called a boarding school where he allegedly suffered abuse.

10.   Caroline later produced six such recordings in the case that were admitted into evidence. However, she did not provide her cellular phone to the forensics expert so that he could evaluate how many times she accessed the cameras and what she obtained from them.

11.   Prior to the events precipitating this divorce suit, Lindsey, his wife, and kids lived in Abilene, Texas.

12.   In December 2023, with her $512,000 in proceeds from the sale of the couple's home, along with a loan from Lindsey of about $360,000, Caroline bought a home in Tyler for $850,000.

13.   The All Saints administrator testified that Trent's parents are benefactors of All Saints, which named several buildings and memorials in their honor for their gifts. They were “highly active” at All Saints, and Trent's mother served the school in an official capacity. This was a “high profile case” because everyone at All Saints and the police knew it involved the Brookshire family.

14.   If a local law enforcement agency believes that a child has been abducted, believes that the abducted child is in immediate danger of serious bodily injury or death or of becoming the victim of a sexual assault, and conducts a preliminary investigation that verifies the abduction and eliminates alternative explanations for the child's disappearance, then the Texas Department of Public Safety will issue an “Amber Alert” to the public on the state notification system. See Tex. Gov't Code Ann. § 411.355.

15.   Caroline kept extensive journals.

16.   Other evidence showed that Trent and Caroline indicated she gave him the first hickey in their relationship and she enjoyed giving and receiving hickeys.

17.   Caroline reported Trent to CPS on more than one occasion.

18.   Caroline agreed that all kids, even great ones, “occasionally fib or stretch the truth or exaggerate,” “sometimes misperceive things,” and are “historically unreliable reporters.” She conceded the children had done this to her in the past. Caroline agreed “someone who says that they want to coparent” and “want their children's father to be involved in their lives” would be “the first to pick up a telephone or send a text message” to the other parent, explain what a child said, and ask him about it before calling CPS.

19.   According to R.L.B.'s therapist, R.L.B. never indicated any type of abuse against her.

20.   We note that although the judgment against Meadows identifies the offense as “injury to a child,” it refers to the section number of the Texas Penal Code pertaining to sexual assault of a child. There is no other evidence in the record to discern the true offense. The sentence assessed in the judgment is relatively minor for what would be a sexual assault against a child offense.

21.   These are the default provisions under the code, and the members may provide otherwise in the LLC's operating agreement. See Tex. Bus. Orgs. Code Ann. §§ 101.054, 101.052. The parties do not point us to anywhere in the record that TDB LLC, has modified the default provisions.

22.   It is important to note this scenario does not involve a liquidation of Trent's membership interest in TDB LLC. Rather, it was TDB LLC's stock asset it held of another company, BGC stock, that was sold and converted to cash by TDB LLC. It is because he did not have any plan to dissolve the LLC and continued to operate it that the distribution is not properly characterized as a liquidating distribution of its assets.

23.   Trent relies on another case for this proposition. See Fannin v. Fereday, No. 01-13-00951-CV, 2015 WL 4463694, at *4-5 (Tex. App.—Houston [1st Dist.] July 21, 2015, no pet.) (mem. op.). Fannin involves the same fact pattern as Grisham and relies upon it as its reasoning. For the same reasons, Fannin is distinguishable. The court even noted “there is no evidence or contention by Appellants that the transfer ․ was income that would have belonged to the community as opposed to a mere exchange in the form ․” Id. at *5. Unlike in Fannin, here, the only evidence before the trial court was that the distribution from TDB LLC was community property income.

24.   Separately, arguments on appeal must correspond with the argument made at the trial court level. See Knapp v. Wilson N. Jones Memorial Hosp., 281 S.W.3d 163, 170 (Tex. App.—Dallas 2009, no pet.).

25.   The balance in TDB LLC's bank account before these deposits, on December 1, was only $8,624.25.

26.   Of course, any recovery for periods that Trent would have incurred after the date of divorce is his separate property.

27.   Trent's citation to the record does not support that he testified the funds were separate property. Other than the trial court's recollection that the funds were Trent's separate property, we found no support for this contention in the record.

28.   Acts 2023, 88th Leg., ch. 411 (H.B. 1547), § 6 (current version at Tex. Fam. Code Ann. § 3.402) (“The change in law made by this Act applies to a claim for reimbursement that is pending in a trial court on the effective date of this Act or that is filed on or after that date.”).

29.   Caroline also apparently borrowed more funds to pay her attorney's fees incurred during the trial, and presumably on appeal as well.

Brian Hoyle, Justice