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The Acceptance of Benefits Doctrine

Posted on in Complex Property Litigation

Texas divorce lawyerMany couples who decide to get divorced have not even heard of the acceptance of benefits doctrine and so don’t know that it could play a significant role in their divorce proceedings. According to this doctrine, litigants are not permitted to accept the benefits of a property settlement and then later decide to challenge it. The only exception to this rule is when the litigant can provide proof that the ruling should be overturned due to special circumstances. This is a difficult task, so if you formerly accepted a property settlement, but later decided to challenge it, you should strongly consider contacting an experienced Round Rock high asset divorce attorney who can explain your legal options.

What Is the Acceptance of Benefits Doctrine?

Just last year, the Texas Supreme Court grappled with the acceptance of benefits doctrine in the case of Kramer v. Kastleman, which involved a couple who had signed a property settlement agreement prior to their divorce. The judge later orally approved the agreement and granted a divorce, although he didn’t issue a written decree until almost a year later. However, before the written decree was issued, the wife rescinded her earlier agreement to the settlement, arguing that her former husband coerced her signature and so committed fraud.

She then officially asked the judge to set aside the earlier agreement, a petition The husband disagreed with and countered by asking that the agreement remain in effect since the wife had already benefited from it by receiving $20,000 on a monthly basis for the rental of a piece of property that the agreement awarded to her.

The judge agreed with the husband and denied the wife’s request to have the prior agreement thrown out. This was followed by an award of $32,000 in attorney’s fees to the husband and the issuance of a final divorce decree. The wife appealed the decision, but the higher court dismissed the case, stating that the acceptance of benefits doctrine did not allow her to challenge the property settlement agreement, as she had already begun benefiting from it.

She appealed the case to the Texas Supreme Court, which reversed the appellate court’s decision and sent the case back to the original trial court. In its decision, the Supreme Court stated that the acceptance of benefits doctrine must be applied on a case by case basis and in this specific case, the judge’s approval of the property settlement months before issuing the final divorce decree constituted unique enough circumstances to justify a reversal of the decision. It also stated that the wife did not have a clear intent to benefit from the agreement during the interim when the divorce had not yet been finalized.

Call Today for Legal Advice

The recent Supreme Court case makes it clear that it is important for couples to make sure that they firmly agree to a property settlement before signing, as getting the agreement and divorce decree set aside at a later date is difficult. For help coming to a settlement agreement with your soon to be ex-spouse, please contact Powers and Kerr, PLLC and a dedicated Round Rock high asset divorce lawyer will evaluate your case.



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