Michael S. Land v. Stephanie Anne Land, 561 S.W.3d 624

Background

Michael and Stephanie Land divorced in March 2014; their final decree incorporated an Agreement Incident to Divorce allocating the 2013 year-end bonus 53% to Stephanie and 47% to Michael, but only as to the “net amount.”
Michael’s 2013 bonus grossed $460,000; after pre-tax deductions ($75,000 deferred bonus and $6,000 PSA) and taxes, Michael’s pay stub showed net pay of $270,288.90; Stephanie was paid 53% of that net ($143,253.12).
Stephanie sued post-divorce to (1) obtain 53% of the $75,000 deferred bonus and $6,000 PSA (total $81,000) she contended were undivided assets, and (2) recover for loss of her engagement/wedding ring (claimed as her separate property under the agreement).
The trial court found the $81,000 were undivided community assets, awarded Stephanie 53% of $81,000 minus 10% tax ($38,637), awarded Stephanie any insurance proceeds for the ring, and awarded attorney’s fees and costs of $30,480.10.
Michael appealed, arguing res judicata, that the agreement already divided the bonus (so post-divorce division was improper), insufficiency of evidence on the ring breach, and error in the fee award.

Issues

Issue	Plaintiff's Argument (Stephanie)	Defendant's Argument (Michael)	Held
Whether the trial court’s August 2015 partial summary judgment precluded Stephanie’s later claim to divide the $81,000 (res judicata)	Res judicata does not bar the undivided-assets claim because the August 2015 order disposed only of the enforcement claim	August 2015 summary judgment disposed of the bonus claims; res judicata bars relitigation	Trial court’s earlier order was not final as to all claims; res judicata did not bar the post-divorce partition claim (held for Stephanie)
Whether the Agreement Incident to Divorce unambiguously divided the $75,000 and $6,000 deductions	Agreement only divided the “net amount”; deductions fall outside that net and remain undivided subject to partition	Agreement’s reference to deductions shows the parties contemplated those items and excluded them from post-division; Michael entitled to keep them	Agreement was unambiguous and divided only the net amount; the $81,000 were undivided community property and subject to 53/47 division (held for Stephanie)
Sufficiency of evidence that Michael breached the agreement by retaining or converting the ring	Testimony and appraisal support that Michael had possession and did not return the ring	No evidence Michael retained or refused to return the ring	Evidence legally sufficient to support an implied finding of breach/conversion in Stephanie’s favor; judgment awarding insurance proceeds upheld (Michael’s complaint waived)
Attorney’s fees: whether the trial court properly awarded $30,480.10 to Stephanie and whether Michael should receive fees	Fees for claims tried are recoverable; fee proof (lodestar) presented but included non-attorney work without qualification evidence	Award improper because fees were not segregated and included non-attorney staff work lacking qualifications/supervision proof; Michael also sought fees	Court affirmed right to fees generally but reversed and remanded the fee award: trial court must delete any fees based on non-attorney work and recompute fees supported by proper proof

Key Cases Cited

Hallco Tex., Inc. v. McMullen Cty., 221 S.W.3d 50 (Tex. 2006) (res judicata prevents relitigation of matters that were or could have been litigated)
Lehmann v. Har-Con Corp., 39 S.W.3d 191 (Tex. 2001) (a judgment is final if it disposes of all parties and claims)
Buys v. Buys, 924 S.W.2d 369 (Tex. 1996) (unambiguous contract construction is a question of law)
Loya v. Loya, 526 S.W.3d 448 (Tex. 2017) (plain meaning of settlement provisions governs treatment of post-decree bonus income)
City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (standards for legal sufficiency review)
El Apple I, Ltd. v. Olivas, 370 S.W.3d 757 (Tex. 2012) (lodestar proof requirements and proof required to recover fees for non-attorney work)