This blog post explores a recent Texas divorce case highlighting the importance of protecting your financial interests, even when a prenuptial agreement isn't an option. The case, Rue v. Rue, involved financial mismanagement and serves as a stark reminder of what can happen when one spouse abuses the trust inherent in a marriage.
Betrayal of Trust and Financial Ruin:
Robert and Alicia Rue, married for 26 years, seemed to have a solid foundation. However, Alicia's world unraveled when she discovered Robert's financial infidelity. He had depleted their children's savings, amassed credit card debt, taken out a secret second mortgage, and even failed to file taxes for years, leaving them in significant debt to the IRS.
While attempting to salvage the marriage, Alicia uncovered Robert's relationship with another woman, funded by their joint account. This ultimate betrayal led to their divorce in 2022.
Justice Served, but at What Cost?
The court, recognizing the gravity of Robert's actions, sided with Alicia. It found Robert guilty of constructive fraud for disposing of marital assets without Alicia's consent. To remedy the damage, the court "reconstituted" the estate, adding back the misappropriated funds. Alicia was awarded 55%, along with a substantial judgment to compensate for her losses.
Furthermore, the court awarded Alicia $3,000 per month in spousal maintenance for ten years, the maximum allowed in Texas. This was deemed necessary as Alicia, a stay-at-home mother for a significant portion of their marriage, faced an uphill battle to achieve financial independence comparable to Robert's.
Protecting Yourself When "Prenup" Isn't an Option:
This case emphasizes that even without a prenuptial agreement, measures can be taken to safeguard your financial well-being. Documenting assets and maintaining separate accounts, as suggested in "When a Prenuptial is Not an Option," can provide a degree of protection.
Open Communication is Key:
Perhaps the most crucial takeaway from both the Rue case and the advice given in the prenuptial article is the importance of open communication about finances. Robert's deliberate concealment of his financial actions ultimately eroded the foundation of their marriage.
Remember, if you cannot discuss financial matters openly and honestly with your partner, it raises serious concerns about the viability of the relationship itself. Trust, once broken, is difficult to rebuild, especially when it comes to finances.