In Estate of Gibson, a man named his sister as the beneficiary of his retirement plan in 1989. No. 06-17-00059-CV, 2017 Tex. App. LEXIS 9963 (Tex. App.—Texarkana October 13, 2017, no pet.). The man married in 2003, but failed to change the beneficiary designation. When he died in 2011, his wife, who was his executor, sued in probate court for a declaration that she was entitled to the benefits. The probate court disagreed, ordered that the benefits were not community property, and ordered that they were to go to the sister. The wife appealed.

The court of appeals disagreed with the probate court’s holding on separate property, but affirmed the judgment. The probate court’s conclusion of law stated that “[a]ny presumption that the TRS Plan Benefits were community property . . . w[as] rebutted by the proof, by clear and convincing evidence, of the beneficiary designation . . . .” Id. The wife argued that, because the plan benefits were in the possession of the man during their marriage, they were presumed to be community property and that the sister did not offer any evidence to overcome that presumption. The court of appeals held that “[d]eferred compensation plans, such as the TRS plan, are considered community property only to the extent they are attributable to the spouse’s employment during marriage.” Id. The court of appeals held that “that portion of the TRS plan benefits attributable to Gibson’s employment while he was married to Fox-Gibson is community property.” Id.

That did not end the inquiry. “Property passing at death pursuant to the terms of a contract, such as contributory retirement plans, are non-probate assets that are not subject to disposition by will or by the rules of intestate succession.” Id. (citing Valdez v. Ramirez, 574 S.W.2d 748, 750 (Tex. 1978)). The court held that the disposition of these assets is controlled by lifetime transfer rules. Id. While being earned by the employee spouse, the right to the benefits under the retirement plan is subject to the employee spouse’s sole management, control, and disposition. This includes the right to designate how the benefits will be paid, whether at retirement or in the event of the employee spouse’s death. “By statute, a TRS plan member may “designate one or more beneficiaries to receive benefits payable by [TRS] on the death of the member” and file it with TRS.” Id. (citing Tex. Gov’t Code Ann. § 824.101(a)).

Therefore, the probate court’s unchallenged findings of fact that “the TRS plan benefits are non-probate assets; that the TRS plan, to the extent it accrued benefits during the marriage of Gibson and Fox-Gibson, was the sole management community property of Gibson; that Gibson designated Ward as his plan beneficiary in June 1989; that the designation was never revoked, amended, or changed; and that at Gibson’s death the TRS plan benefits became payable to Ward” “are consistent with the Supreme Court’s holdings in Valdez.” Id. The court held that “since the probate court entered the proper judgment, its erroneous conclusion of law does not require reversal.” Id.

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Photo of David Fowler Johnson David Fowler Johnson

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David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the The Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary…

[email protected]

David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the The Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary field in Texas. Read More

David’s financial institution experience includes (but is not limited to): breach of contract, foreclosure litigation, lender liability, receivership and injunction remedies upon default, non-recourse and other real estate lending, class action, RICO actions, usury, various tort causes of action, breach of fiduciary duty claims, and preference and other related claims raised by receivers.

David also has experience in estate and trust disputes including will contests, mental competency issues, undue influence, trust modification/clarification, breach of fiduciary duty and related claims, and accountings. David’s recent trial experience includes:

  • Representing a bank in federal class action suit where trust beneficiaries challenged whether the bank was the authorized trustee of over 220 trusts;
  • Representing a bank in state court regarding claims that it mismanaged oil and gas assets;
  • Representing a bank who filed suit in probate court to modify three trusts to remove a charitable beneficiary that had substantially changed operations;
  • Represented an individual executor of an estate against claims raised by a beneficiary for breach of fiduciary duty and an accounting; and
  • Represented an individual trustee against claims raised by a beneficiary for breach of fiduciary duty, mental competence of the settlor, and undue influence.

David is one of twenty attorneys in the state (of the 84,000 licensed) that has the triple Board Certification in Civil Trial Law, Civil Appellate and Personal Injury Trial Law by the Texas Board of Legal Specialization.

Additionally, David is a member of the Civil Trial Law Commission of the Texas Board of Legal Specialization. This commission writes and grades the exam for new applicants for civil trial law certification.

David maintains an active appellate practice, which includes:

  • Appeals from final judgments after pre-trial orders such as summary judgments or after jury trials;
  • Interlocutory appeals dealing with temporary injunctions, arbitration, special appearances, sealing the record, and receiverships;
  • Original proceedings such as seeking and defending against mandamus relief; and
  • Seeking emergency relief staying trial court’s orders pending appeal or mandamus.

For example, David was the lead appellate lawyer in the Texas Supreme Court in In re Weekley Homes, LP, 295 S.W.3d 309 (Tex. 2009). The Court issued a ground-breaking opinion in favor of David’s client regarding the standards that a trial court should follow in ordering the production of computers in discovery.

David previously taught Appellate Advocacy at Texas Wesleyan University School of Law located in Fort Worth. David is licensed and has practiced in the U.S. Supreme Court; the Fifth, Seventh, and Eleventh Federal Circuits; the Federal District Courts for the Northern, Eastern, and Western Districts of Texas; the Texas Supreme Court and various Texas intermediate appellate courts. David also served as an adjunct professor at Baylor University Law School, where he taught products liability and portions of health law. He has authored many legal articles and spoken at numerous legal education courses on both trial and appellate issues. His articles have been cited as authority by the Texas Supreme Court (twice) and the Texas Courts of Appeals located in Waco, Texarkana, Beaumont, Tyler and Houston (Fourteenth District), and a federal district court in Pennsylvania. David’s articles also have been cited by McDonald and Carlson in their Texas Civil Practice treatise, William v. Dorsaneo in the Texas Litigation Guide, and various authors in the Baylor Law ReviewSt. Mary’s Law JournalSouth Texas Law Review and Tennessee Law Review.

Representative Experience

  • Civil Litigation and Appellate Law