JOHNNY LEE SAUNDERS v. DALLAS DISTRICT CLERK (Other)

State: Texas

Docket No: WR-73,284-01

Case Date: 01/13/2010

Plaintiff: JOHNNY LEE SAUNDERS

Defendant: DALLAS DISTRICT CLERK (Other)

Preview:James G. Lifshutz; Liberty Financial Corporation, Liberty Properties Partnership, Texas Home Improvements, Inc., and Berlee Lumber Company, Inc. v. Kymberly Benson Lifshutz--Appeal from 150th Judicial District Court of Bexar County
MAJORITY | MAJORITY CONCURRING OPINION No. 04-05-00117-CV James G. LIFSHUTZ, Liberty Financial Corporation, Liberty Properties Partnership, Texas Home Improvements, Inc., and Berlee Lumber Company, Inc., Appellants v. Kymberly Benson LIFSHUTZ, Appellee From the 150th Judicial District Court, Bexar County, Texas Trial Court No. 97-CI-13199 Honorable Michael Peden , Judge Presiding

Opinion by: Alma L. L pez, Chief Justice Concurring opinion by: Sarah B. Duncan, Justice Sitting: Alma L. L pez , Justice Sarah B. Duncan , Justice Rebecca Simmons , Justice Delivered and Filed: April 26, 2006 The majority holds that the business reorganization by which Liberty Financial Corporation acquired the Berlee Lumber Company stock resulted in a legally cognizable distribution to James and thus can form the predicate for Kymberly's reimbursement claim. I disagree. The majority's holding promotes form over substance. Even if the form of the transfer could be interpreted as a distribution to James, it is only because that form was dictated by tax considerations. In substance, there was no distribution of the stock to James. The majority's holding thus "tend[s] to engraft upon our community property system the manifest complexities of federal tax law." Thomas v. Thomas, 738 S.W.2d 342, 345 (Tex. App.-Houston [1st Dist.] 1987, writ denied). And it wrongly injects into the entrepreneur's

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choice of a business organization form - usually guided by federal tax consequences and personal liability concerns (1) - the irrelevant consideration of property characterization under Texas law. Because I would instruct the trial court that it could not consider the transfer of the Berlee stock as a basis for Kymberly's reimbursement claim, I concur in the judgment only. Sarah B. Duncan, Justice 1. See generally 19 Robert W. Hamilton, Texas Practice: Business Organizations 31-38 (1973 & Supp. 2002).

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