Chad Petross | Tracing 101 for Family Lawyers

Tracing is crucial in many clients’ divorce cases…

And any reputable family lawyer should understand this process.

If your client can’t afford to hire a tracing expert, you may be the one responsible for tracing—so you need to know the ins and outs.

In this episode, Chad Petross breaks down tracing for family lawyers and shows you how these techniques can help your client get the best possible result.

Listen to learn:

  • Tracing techniques for bank accounts and investment accounts
  • How to present tracing information in court
  • Tips for preparing for mediation
  • And more

Mentioned in this episode:


Chad Petross: If they are looking at a very detailed comprehensive tracing summary that you’ve provided them, and they know they’ve got a mountain of documents back at the office that have all of these statements in them. And in order to prove that you’re wrong, they’re going to have to go through all of those with a fine tooth comb, the more detail you can give them, the less likely it is, I think, that they’re gonna fight about that. And you’re probably gonna get that that term put in your mediated agreement.

Voiceover: You’re listening to the Texas Family Law Insiders podcast, your source for the latest news and trends in family law in the state of Texas. Now, here’s your host attorney Holly Draper.

Holly Draper: Today we’re excited to welcome Chad Petross to the Texas Family Law Insiders podcast. Chad is board certified in family law and is the owner of the Petross Law Firm in Weatherford, Texas. He grew up in Vernon, Texas in a blended family before obtaining his undergrad degree from Abilene Christian University in May of 2002. Chad graduated from Pepperdine University School of Law in 2006. He’s been married to his wife Amanda for five years. They live in Aledo, Texas with two nieces, one nephew and one rescue dog, Griffey. Thank you so much for joining us.

Chad: Thanks, Holly. Thanks for having me.

Holly: So why don’t you start by telling us a little bit about your background?

Chad: Yeah, so I’ve been practicing law for about 15 years now, little more than 15 years. It’s almost exclusively been in family law. I did a little bit of criminal defense work when I first started as a baby lawyer, but the firm that I was working for did about 95% family law. And so since that time, that’s really what I’ve been doing and moved off in towards the Fort Worth area in Weatherford when I met my wife, and opened my own practice, in this area in 2013. So just been doing that ever since.

Holly: So today, we’re gonna talk about a topic that a lot of attorneys, myself included, do not really love.

Chad: Myself included, as well.

Holly: There probably are some property nerds out there who really like this topic, but we’re going to be talking about tracing, and more specifically tracing on a budget. Because I know a lot of us have clients that can’t afford to hire that big high dollar expert to trace their funds. But yet, the funds that need to be traced are important to them and are a lot in their world. So can you explain kind of what tracing is and why we might need to do it.

Chad: So I kind of just say, tracing is when somebody who had some money prior to the marriage is looking to prove and kind of retain that property, whether it’s funds, whether it’s real estate, retirement accounts, bank accounts. Anything that they feel like they should have some extra property interest in over their spouse, because they owned it prior to the marriage. If it’s separate property, then in order to prove that it’s separate property, tracing is the exercise that we go through to try to try to prove that to a court and have that.

And the important part of it is if you can prove that it’s separate property, then the judge doesn’t have any discretion to award that property to the other spouse. And so you kind of pull a certain percentage or a certain piece of property out of the community property division. And, you know, you get your clients for something that, you know, if you look at it all as one pie, it could really skew the percentages in their favor. If they can get some separate property, that’s confirmed as theirs.

Holly: So I know we have a lot of newer lawyers who listen to the podcast. So can you give us kind of the basics, separate property versus community property?

Chad: Sure. So the Texas Constitution defines separate property. In the original draft of the Constitution adopted in 1876, Article 16, Section 15. And it says that all property that a spouse owned prior to the marriage, or if it was acquired after the marriage by gift, devise or descent is going to be the separate property of that spouse. And then it states kind of laws are going to be passed to more clearly define these rights. But the Texas Constitution sets that up.

And then the laws that were passed to clearly define the rights are what we looked at right now are the Texas Family Code Chapter Three, 3.001 through 3.003, that basically say the same thing. That community property is property, that’s not separate property, that is acquired by the spouse by either spouse during the marriage. And then all property possessed is going to be community property unless it’s proven by clear and convincing evidence to be separate property. And then separate property is basically just defined as what you had prior to the marriage or what you’ve acquired during the marriage by gift, devise or descent.

Holly: And there’s also a provision I think it’s often forgotten about and probably not super common. There are certain personal injury type damages that also fall into that separate property category.

Chad: Yes, the specifics on that, are any recovery for personal injury, sustained by the spouse, but it can’t be recovery that’s for loss of earning capacity. So if you suffered an injury, and you know, you, you were covered for medical expenses or were covered for, you know, punitive damages or something like that, that’s going to qualify. But if it was specifically for loss of earning capacity, then that’s going to still be community property, because that would have been earned during the marriage, presumably, so that would be community.

Holly: So you mentioned the presumption that everything is community and the clear and convincing evidence standard. So that’s obviously why we need tracing is to overcome this presumption, if you’re trying to prove something is your separate property, is your client’s separate property. So what exactly is the level of proof required to overcome that clear and convincing evidence standard in this situation?

Chad: You know, in law school, I kind of learned that it was clear and convincing was it’s it’s somewhere like it’s hard to define, right. So it’s somewhere in between preponderance, which is just barely tips the scales in your favor. And it’s not to the level of beyond a reasonable doubt, the criminal burden of proof. So it was kind of taught to me that clear and convincing, you know, is somewhere in that maybe 60 to 75% range. But really the case law states that clear and convincing evidence is the level of proof that provides a firm belief or conviction that the allegation made is true in the mind of the trier of that.

So if a judge just has that firm belief or conviction, you know, you’re, that they’re gonna find clear and convincing evidence, and it’s not, you know, the appellate courts can look at it and and kind of look at it and second guessing a little bit, but a judge has a lot of discretion, as you know. So if there’s enough evidence that can produce a firm belief, which is obviously a little bit of a vague standard in and of itself, then the judge should be on, on good ground to go ahead and find that clear and convincing evidence.

Holly: And I know, there’s two cases kind of on this topic, one coming from the Fort Worth Court of Appeals, in Boyd versus Boyd, and the other from the Dallas Court of Appeals in Pace versus Pace. Can you talk a little bit about those two cases and what they tell us?

Chad: Yes. So the the Boyd court and the Pace court, each, those cases talk about what type of evidence is necessary to meet the standard of clear and convincing evidence. And we get a split of the story here, because the Fort Worth Court in the Boyd opinion, required that a spouse trying to trace their separate property and trying to meet this clear and convincing standard had to bring in documentary evidence. Had to have paperwork basically that says, you know, here’s the proof that the property is separate property. If you contrast that with the Pace court, or the Pace opinion, the Dallas court said that oral testimony was sufficient.

And so, you know, when you’re a practitioner, you want to kind of overdo it a little bit and make sure your case is provable for the court when you’re preparing. So the safe bet is to have documentation to prove your claims. But if you can’t have documentary evidence, for whatever reason, you can kind of rely on that Pace opinion out of the Dallas court. And it finds that oral testimony can be sufficient. And, you know, later on, I talked about in my prior presentation in the paper, that the Pace opinion can help you. I think more like when you’re talking about personal property.

You know, you may not have that receipt for that piece of jewelry that you bought 30 years ago, and you know, 10 years before your marriage or whatever. But if you can testify about specifics about the circumstances and when you acquired it and how much it cost, you know, particulars about identification things of the piece of property, I think that’s going to help you with your oral testimony. The more proof you can give, obviously, the more clearly and convincing you’re going to be that is your separate property.

Holly: So I know one of the other topics that we need to look at if we are tracing would be the inception of title. Can you explain what that means and how it fits into this discussion?

Chad: So inception of title I, I liken it to kind of a foundational rule of characterization. So if you’re trying to determine what the character of piece of property is, inception of title is going to be the first place that I would start. And inception of title, it’s a long standing theory in, in Texas case law. One of the earliest articulations, I could find that was then in Welder v. Lambert in 1898. But it basically says that the beginning of the title, when the property was originally owned or claimed, is going to be when the character of that property is fixed. So if you acquired the right to own or claim a piece of property prior to the marriage, then the inception of title would indicate that that’s going to be a separate property asset. Whereas if you acquired that, right to that property to that owner claim to that property during the marriage, then it will be a community property asset.

Holly: We see this a lot in terms of the couple is about to get married, they’re going to buy a house, they contract to buy the house before the marriage, but they get married before they close on the purchase. And they are often very surprised to find out when the divorce comes that guess what, that’s separate property, not community property, and you better hope both your names are on it, because otherwise, we’re gonna have a problem.

Chad: Right. I mean, nowadays, in real property, the closing dates can be so quick, you know, I know it happens. And I’ve seen it happen. In certain cases, it kind of boggles my mind to think that people have are planning a wedding. And then they are also buying a house at the same time and enter a contract. And they’re going to close, you know, right after the honeymoon when they get back. But it does happen.

And you know, that’s if you got a 30 day or 45 day close, but you know that that deed was entered at around the time that these parties got married, then you need to be really careful and make sure you find that contract and know when the parties actually sign the contract. Obviously, what’s in the contract is going to have some play into this. Because if one party entered the contract, and the other didn’t, because they weren’t married, then I would presume, hopefully, that the deed would say the same thing. But you never know.

So if they were, sometimes these title companies, they’ll say, they’ll ask you, you know, the day or two before you’re ready to close, are you married or not? Or do you want both names on the deed, and so they kind of leave it up to you. And if you put both names on the deed, but your contract was before the marriage actually, was ceremonially, I guess, done, when you went to the ceremony and got married, then you could have a problem with your characterization and end up with a community property asset that you didn’t intend on.

Holly: Or a separate property asset that you didn’t intend to be community, where you know that example where let’s say that the husband to be is the one that signed the contract, the parties get married, and then they both end up on the deed, I would say that we have a separate property gift of 50% to the wife, but it’s still separate property that the court doesn’t have the authority to give to one side or the other.

Chad: Right, and this is where it gets really fact intensive and detailed about you know, what happened first, when the inception of title occurred. So that contract is what’s going to fix the character of it. And then like you said, if you have a deed that put both names on the deed, and the contract and the inception of tunnel was that this was going to be separate property, because that all occurred before the marriage actually occurred.

Then that leads to that presumption you’re talking about that the separate property owning spouse originally then gifted a one half separate property share to the other spouse when they included them on the deed. And, you know, you’re gonna have to include a partition suit I think, at that point, in your case, to have a court divide that property or order something done because they can’t divest either party of their separate property share or interest in that part property. They can award the house to the other, to somebody, one person as a community property asset.

Holly: So shifting from real estate a little bit, if we’re talking about investments, bank accounts, more liquid cash. Talk a little bit about what tracing that looks like. Going back.

Chad: You know, with bank accounts, this can be the kind of more tedious part of tracing. But again, you want to start with, you know, the inception of title with these accounts, when the account was opened, whose name is it in. There are certain rules that apply as far as commingled accounts. You’ve got the community out first rule that would say if you’ve got an account that has both community funds and separate funds in it, then the Sibley court, Sibley opinion out of the Dallas court talks about the presumption is that community funds are going to be the first thing drawn out of that account prior to the separate funds in that account.

So then, you know, you kind of look at what is the balance on that account, at the date of the marriage, if it’s a commingled account, and kind of start with that being your separate property interest in that account. And then you kind of have to follow, you know, if it’s, if it’s an account that has, you know, routine expenses, and routine income put in and out of that account, you know, you have to follow monthly, essentially, go to the statements and see what money came out of that account, what balance did it get to?

Was there more money put in that account then came out, then in that situation, your separate property spouse who owns that as separate property is gonna have a lot bigger interest, versus if the, the account was spent all the way to the zero, you know, or you know, close to that. Then all of that all of that separate property interest in that account would have been spent as well. And so this is where it gets really tedious. In following all of these transactions, and the minimum balance method is what I was referring to where it reaches a certain, the low watermark of that account, is going to be the most amount that you can prove is going to be the separate property.

Unless after you’ve gotten to that low balance, you can prove that more separate property was put into that account. So you have you know, income from a separate property asset or something that was that was deposited into that account, then you can increase that minimum balance. But short of those things, you know, you’re going to, you’re going to basically look at what that minimum balance is. And that’s going to be the most that you can get your client awarded that separate property.

Holly: So the community out first rule and the minimum balance method work together. They’re not conflicting with each other in any way, right?

Chad: Right. That’s how I take that, yes.

Holly: All right. So, how do you go about, like, logistically, we want to trace this account. What do you need, documentation wise, to prove this is my separate property? Or this is my client’s separate property?

Chad: So if you’re tracing a bank account, I would say the first thing you’re going to need is you’re going to need a statement that is probably, one statement that is right before the date of marriage. The most recent monthly statement if you get monthly statements, right before the date of marriage, and then if you can, if you can find the most of these accounts have a daily ledger. So a certain date this transaction occurred, and then it would have the amount of that transaction and the ending balance. And so if you can find, if you can actually find a transaction that occurred on that day, then you can find the actual balance on the day of marriage.

And that’s, or the day before marriage, maybe that was that would be your kind of starting point for here’s the separate property interest of my client. And then you kind of from that point would have to work forward to towards the present day. And kind of follow what the beginning balance was each month. How much of that was separate property, had any of the separate property been spent, or has any more separate property been deposited into that account?

What was the beginning amount of community property in that account, and then follow the transactions. And if you can trace a transaction, specifically to a separate property portion. So like a lot of times in these, you the tracing specific transactions method comes into this. So if you had deposited, let’s say, you know, $100,000, into an account that was commingled, but then very shortly after that, a withdrawal of $100,000 was made, you can use case law to go in and determine and define that as specifically as separate property. The withdrawal from the account. And then if that if it resulted in a piece of property, then that can be a separate property asset as well.

So then you just have to go through each month and just follow the separate property transactions, follow the community property transactions, and then end up with a separate property balance and a community property balance at the end of each month. And so over the course of the marriage that lasts, you know, 20 years, you can see how this can be a really fact intensive and it’s just a really tough exercise to do, which is, you know why I generally start off saying if you can, if your client can afford it, and you’ve gotten this, this length of a marriage, and you’ve got a commingled account that you’re going to have to go through, you know, with a fine tooth comb, all of these monthly statements, you’re probably going to want to get a tracing expert, to help you with this.

If for nothing else than to, maybe not to testify, you maybe don’t have to pay them to sit in court, you know, for two days or whatever. But, you know, at least to organize your case, to help you come up with and show the documentation to the judge that you’re going to need to give them that firm belief or conviction to meet your clear and convincing standard.

Holly: And I know with a lot of the courts where I practice anyway, usually your trial, maximum, you’re gonna get it day. So you’re looking at three hours a side. And if you’re trying to trace back, even a singular bank account for 20 years, is that possible to show by clear and convincing evidence in that amount of time that something is separate?

Chad: Is it possible? I think, I think it’s possible. I think you’re gonna have to do some really, some really tight summaries. Some, you can, you can provide the statements to the court to, for them to look at maybe after they take it under advisement. But give them summaries, and say, look, we we’ve traced this, and we can say, you know, based on the statements that we’re providing to you judge, the summary is that, here’s the separate property balance on the date of the marriage, here are the transactions.

We’ve got this amount of community property coming out, we’ve got this amount of community property being deposited in. The minimum balance is here. You know, summarize it in that manner. And, you know, maybe you just rely on that minimum balance method, maybe you just say, Judge, we’ve got 20 years of statements here, but the amount of separate property was in that account at the date of marriage was 100. It never got below $50,000. And so you know, well here’s the, here’s all the statements that you can look at, and we want the $50,000 awarded to our client.

So if you’re, if you’re pressed for time like that, use those tools, that minimum balance method, use tracing specific transactions. Go in and say that this amount was deposited from a separate property sale of a residence, and it went directly to purchase the next residence, you know, 30 days later. Use those things to your advantage when you’re pressed for time. And, and, you know, summarize it for the court and get out of it what you can. You know, and if you’re talking about large sums of money like that, it’s going to be well worth it to your client to go through that exercise.

Holly: So we’ve talked a lot about bank accounts, which I would think is the most basic that you can trace. But when we’re looking at, say, an investment account, where there are dividends, and there are, there’s increase in value of the stock. How much more complicated is it to try and do a tracing in a commingled investment account?

Chad: Well, so yeah, commingled investment accounts. You know, there’s, there’s certain methods to, that I see most of the time in these cases where you’ve got a mixed character account where there’s some separate property interest in this retirement account. But it’s lion’s share that has been accrued during the marriage. And a lot of times people just are going to default to well, I’ll get the balance of the account on the date of marriage. And we’ll get the balance of the account now. And we’ll just just chalk that up to the separate property interests on the whatever the balance was on the day of the marriage, and just ask that to be awarded to our client, and then move on down the road.

You know, and most of the time, that’s probably going, well especially when you’re doing it yourself, if you’re tracing yourself, that’s probably going to be the best use of your client’s money to do it that way. I’ve always been curious, though, and I’ve never argued it. But I think it can be argued that if you had a investment account where you have increase in stocks, or increase in the stock value of holdings that were acquired prior to the marriage, and you can find them on the date of the marriage, and those stocks that they’ve significantly increased in value, or, you know, maybe you’ve added some stocks to it, but it’s really a lot of it’s just the increase in value of the stocks.

If you can argue that those stocks were owned prior to the marriage, then any increase in the value, just sole increase in the value of those specific stocks, is going to be your client’s separate property. And so in the paper I refer to it like Tesla stock. You know, you can have a five year marriage as you look back right now, but if that party owned Tesla’s stock five years ago, you know, if they had 100 shares in Tesla stock, and now they have 200 shares in Tesla stock five years later, you’re gonna want to probably argue that those, the increase in value of this account is due to the fact that they had 100 shares of Tesla stock that they bought at a really low price compared to what it is right now. And that judge, that same 100 shares are still owed there. Owned there.

So we, we want the value of those 100 shares awarded to my client, and that’s going to wildly skew those percentages in that retirement account in your client’s favor. Obviously, as you deposit money into those accounts, while the marriage is ongoing, that’s going to be community property. So anything new, any new stocks that were bought during the marriage is going to be community property. But if you’ve got an asset like that, or you know, I’ve heard another example of Apple stock, or some maybe speculative tech stock, or some other kind of speculative stock that has really hit, then, you know, that may be something that you can prove with little difficulty, if you can go find the statement that was right before the marriage, and you can say, look, here’s the number of stock that was owned, right before the marriage.

Here’s the number of stock that’s on right now. The value of it on the date of marriage, you can go find that, you know, on the Dow Jones records and say, the value of that stock on the date of marriage was x, and now it’s y. So the increase in that, you know, we want these 100 shares to be valued at that amount, because honestly, they didn’t really spend any money on those specific shares, while the while the marriage is ongoing.

Holly: I think you also want to look and see, if you have a stock like Tesla or Apple that has gone up dramatically during the marriage, you want to check and see if it has split, too, because the person that started with 100 Tesla shares that now has 200, did they buy 100 more during the marriage? Or did it split? And they really, it’s really still all their separate property?

Chad: Right. And this is where it starts to get over my head, where we would have to bring an expert in to testify to those things.

Holly: I don’t know how you find that out, but I assume that it can be found out.

Chad: Yes, yes, yes.

Holly: So if you are, you’ve got a case and you’re looking towards trial. And you know, there are some separate property issues, what are some things that attorneys need to be looking for in terms of pleadings?

Chad: Well, so the first thing is you got to put your client on or you got to put the court and the other side on notice of anything you’re going to be asking for in court. And so your pleadings are going to have to include the request for the court to confirm separate property of your client. And I, I generally throw this in, I mean, I know most people throw in a request for attorneys fees in their pleadings at the end. Any kind of divorce that I have, or there’s any kind of property, I’m almost always going to throw in a request for the court to confirm separate property, because when you go and meet with them the first first time in your consultation, I mean, you’re not going to be asking questions about, you know, the specifics in the jewelry that they have. Was there a grandmother’s ring?

Or you know, and you can have, you know, even a car that a husband has been restoring that he owned it prior to marriage. Like there’s a lot of assets that aren’t going to be discussed in that first consultation. And maybe you’re not even going to find out about that until the inventory comes in. Or maybe the discovery is completely answered. And so I’m almost always going to request a confirmation of separate property for the court to do that. And so as long as you have something like that in there, you’re going to in most circumstances, you’re going to be able to argue a separate property claim.

Now, if reimbursement is coming in, you know, that’s a more detailed pleading, I think. And you’re probably not going to be able to bootstrap your separate property pleading to plead a reimbursement claim. You’re probably going to have to add that. But the general rule is put the other party on notice of all of the things that you’re going to request in the property division, including separate property confirmation reimbursement from one estate to another, and make sure you’ve got your pleadings in order before you’re ready for trial to be able to talk about all of these things in front of the judge.

Holly: What are important things to keep in mind from a discovery standpoint when you’re looking at tracing issues?

Chad: So again, going back to the split of authority in the Boyd versus Pace case, obviously, if you have discovery that’s been propounded upon you, you’re going to need to come up with the documentation that’s going to be required to prove your separate property claim. And it’s going to have to be provided to the other side sufficiently in advance of trial. And there’s another reason for this, I mean, most of these cases, you know, if we’re, if we’re tracing a separate property interest or separate property asset that may not be $100,000, but maybe it’s, you know, $5,000, $10,000. And people aren’t really going to fight tooth and nail for that portion of it. The more discovery that you provide, the more documentation you provide to the other side to just prove that, here’s my claim of separate property, my clients claim on separate property, the more likely you are to settle the case.

And that’s kind of the whole purpose of discovery. I know we get into discovery fights, and, you know, in arguments with opposing counsel all the time about discovery, but the purpose of it is to is to put the cards on the table. And so if you produce all of the documentation and discovery that you need to prove your claim, then you’re more likely to settle a case. And if it’s something that may be both one side is not going to dig their heels in on and fight tooth and nail for you know, that $20,000 in that retirement account, then you can you can save your clients some money and obviously avoid a trial if you if you can show all of those things in your discovery responses.

Holly: So we’ve gone over most of the different types of property that we commonly see in divorce cases, but one area we haven’t covered yet relates to a party’s business interests. Can you talk a little bit about tracing with respect to business interests.

Chad: I can talk a very little bit about tracing as a respect to business interests. I’ve had businesses that have been valued, and you know, you get a valuation expert to come in and value a business. And, you know, in most business situations, those things are going to be over my head. And I’m going to need an expert to explain to me, you know, what the value of the business is. How can you trace what was acquired prior to marriage? What the value is of it now, how can you prove what the value of the business was on the day of the marriage, you know, it was years ago.

But, I can tell you that in the valuations that I’ve seen done, I’ve run across a number of, you know, issues that have popped up in valuation of businesses. You know, I can tell you, in general, certain rules for valuing a business, you know, asset approach, income approach, that kind of thing. But one thing, you know, if you’re, if you have a party to a marriage, who’s got a partnership agreement, I think that’s the one thing you really need to be on guard for is, a lot of these partnership agreements, have terms in them for what happens to the business, if one of the partners goes through divorce.

And these parties that are entering into these agreements, you know, they’re, they’re kind of anticipating, maybe not anticipating a divorce, but they know all the partners are married. And they have seen enough in their experience where a divorce can, you know, completely destroy the partnership. And so these partnership agreements in these incorporating documents, if you can get a hold of those and, and see, you know, what the effect of this is going to be, the effect of the divorce is going to be on this business, that’s gonna play into the value of the business as well.

So if you did, do get a valuation expert, and you know, it’s going to end up breaking up the partnership, because the divorce is gonna, is gonna require the partner spouse who has not had any dealings with the business, get bought out a certain percentage, that’s going to be something that you’re going to want to make sure that you’re on top of when you get ready for trial.

And actually, for mediation, you know, does your client really want to potentially break up this partnership, if it’s provided a stable income for the other spouse, and it’s going to be where child support comes from. Or it’s going to be where post divorce maintenance comes from. After the marriage is done do they really want to go down that road and break it up, you know, kind of kill the golden goose for lack of a better term.

Holly: You mentioned mediation just a minute ago. How do you go about preparing for mediation and trying to prove your separate property tracing claim? I know a lot of times in mediation, we have like our little inventory chart, and we have like $1 amount of this is the separate property going to this person. But is there some other method that you use to help show the other side look, this is legitimate?

Chad: Well, I mean, I’m assuming that when you go to mediation that you’ve probably done your discovery. You’ve gotten these statements that have, that you’ve relied on yourself when you’ve done your tracing exercise, and you’ve provided that to the other party. But, you know, I’m sure you’ve experienced Holly and I have to, but you know, when you get a mountain of documents, you know, you’re not necessarily going to do the other side’s tracing exercise for them prior to mediation. So, you know, if you really think that this could be something that is going to be a sticking point in this case, then I would go ahead and go and do your, your tracing summary, at least for, that you would do for the judge when you were in trial for the purposes of mediation.

And show them, okay, here, you’ve got all the documents, but here’s the summary. The balance got to this amount, it’s the lowest amount it got to. Here’s the amount, and we can prove that it was separate at the time of the marriage. You know, at the very least, you know, I’m bringing in to mediation, the statements from the retirement accounts that show what the balance was on the date of marriage. And if we’re going to use the just the just that method, where you just subtract the value on the date of marriage from the current value, and that’s going to be the separate property, then, you know, in some mediations that will get it done. But if you’re talking about a detailed tracing, that you’ve done on your own, then summarize that, bring it to the mediation and provide it to the mediator ahead of time and to opposing counsel.

And let them kind of digest it a little bit before you get into mediation. I mean, you know, in these day long mediation, where we’re talking about kids and property, you know, the property kind of gets pushed to the side, in most of these cases. And so, you know, you’re, you’re going through, and you’re like, you know, getting ready to settle the case at three o’clock. And you’re like, oh, yeah, remember, I’ve got this tracing of this account that we’ve got that, you know, we’ve got an hour now to figure this out before we hit five o’clock, if we’re gonna pay for this by then. So, you know, the more information you can provide to the other side of the mediator prior to mediation is going to help you be more successful.

Holly: Yeah, I think providing, especially if it’s something that’s going to be a contested issue, or you’re very far apart on the issue, I think the extent that you can get that to the other side, before mediation, now not all lawyers are going to read it, not all are going to share it with their client, but it’s all you can do is try to get that information in front of them to help speed the process along at mediation.

Chad: Right, right. And, you know, if you, if you are well into the case, and you’ve got discovery that’s been done for months, and you’re getting ready for mediation, if you have an expert who’s helped you trace any of this stuff, even just to help you trace it, maybe not testify about it, you know, those discovery requests asks for those reports. And you know, it may, you may be able to say, well, they’re not retained as an expert, or they’re not going to testify as an expert, I don’t have to give you this report. But if you want your case to settle, give them that information, you know, the more information you can give them the not hide the ball on it, the more likely your case is to settle.

And you know, if if they are looking at a very detailed comprehensive tracing summary that you’ve provided them, and they know they’ve got a mountain of documents back at the office that have all of these statements in them. And in order to prove that you’re wrong, they’re gonna have to go through all of those with a fine tooth comb, the more detail you can get them, the less likely it is I think that they are going to fight about that. And you’re probably gonna get that term put in your mediated agreement.

Holly: So you mentioned a couple of times about having a paper on this topic. Where can our listeners find that paper?

Chad: Sure. So it was a paper that I did for marriage dissolution 2022, the Fort Worth course, and that was back in April. And so it’s available on Texas Bar CLE on on their, their search searches for the courses, you can go find the papers in there. Obviously, if you attended the course you have a copy of it. If you need a copy of it, or want a copy of my PowerPoint or anything like that, you can feel free to email me, [email protected]. I’d be happy to provide the paper to you or the PowerPoint.

And in each one of them there’s an appendix that I’ve attached to the paper and there’s a slide in the PowerPoint that has the kind of one page sample of a tracing spreadsheet I guess you’d call it that it’s got 15 or 20 line entries in it that you know you can take a statement and pull you know each balance from each monthly account or monthly statement and put it in there and track the separate property or community property that was deposited and taken out of it. And you can take those and reproduce those and help it, use it to help you with your tracing. So that’s available there, or you can email me and I can just send you that one page. That’s a one page spreadsheet and get it to you as well.

Holly: Perfect. So we’re just about out of time. But one of the things that I like to ask everyone who comes on the podcast is, if you could give one piece of advice to young family lawyers, what would it be?

Chad: Oh man. Something that gives me kind of night sweats, I think, is thinking about hanging out a shingle on your own without, right out of law school. Like if I had done that, it just gives me anxiety. So I think that, and the good thing that I had, and the firm that I was with was I had mentors in that firm, who were seasoned family lawyers, who helped me kind of learn the ropes and kind of held my hand when I was learning these things. So even if you are, whether you’re in a firm, or whether you’re hanging out a shingle on your own, right out of law school, find somebody who you can lean on to kind of be a, for lack of a better term, a mentor. I mean, don’t go up and ask them if they’ll be your mentor, but you know, just somebody who you trust and who can explain things that you understand.

And lean on them a little bit. I mean, I know personally, I had mentors of my own, I still have mentors, who I ask questions to. And, you know, most attorneys have had that. And so don’t be afraid to ask somebody for help, who’s a more seasoned attorney. Because, personally, me if you came to me and asked me a question, because you need, you need that information, I’m going to give it to you, regardless of whether we’ve gone toe to toe on a case or not. If if a family lawyer comes up to me and is trying to learn and trying to figure things out for their cases, I’m going to help them with that, you know, 99.9% of the time.

So if you’re if you’ve got any, any aspirations of being a family lawyer, find seasoned experienced family lawyers who have done this for years, and just befriend them. And you know, they’re going to be, I find family lawyers, and especially in this state to be some of the most helpful groups of lawyers, probably the most helpful group of lawyers. I’m a little biased, but I think that that’s the case. And I would, I would make sure that you have a, if you can, get a network of people who you can call about anything. I mean, because you know, what, things we talked about in preparing for this Holly, like, I didn’t consider myself an expert in tracing, somebody asked me to write a paper about tracing.

But there are experts in all different kinds of issues that we we cover in family law cases. And so if you, the more people that you have, the more likely it is that you’re going to have somebody who’s come across an issue and that’s how we become experts. Is we we come across an issue that we research because we have a case that we’ve got to deal with. And so you’re going to, the more people you have that you can lean on and ask questions, the you’re going to find somebody who has encountered the issue that you’ve got, and you can ask them those questions.

Holly: Yeah, I agree 100%. You know, to this day, I’ve been practicing for a very long time. At least is seems like it to me, but you know, I still have mentors that I will pick up the phone and call if I have a question. And you know, I’m in a situation where I have others in my firm and we can bounce ideas off of each other. But for someone who is a solo or just going out on their own, you don’t have that. You have to find it in other ways.

Chad: Yes, for sure. Now, the caveat to that and I learned this through the grapevine from Richard Orsinger is don’t come to me with a question if you haven’t looked into it on your own. You know if you’ve if you’re just using a mentor to kind of be your legal research arm of your firm or solo firm, then you know if it’s something that can be found in the family code for instance then look there first. Do your due diligence but you know if you’re if you’re hitting a roadblock or hitting a wall, you can’t, you can’t find the answer to the question you’re looking for, then by all means you need somebody you can reach out to that you trust and can give you that information.

Holly: So where can our listeners go if they want to learn more about you?

Chad: Oh about me. Come to me. I’ve got a website It’s fairly regularly updated. I’ve got Facebook pages, Twitter accounts. The Petross Law Firm on Facebook. Twitter account is at Petross Law. I mean full disclosure, my twitter account is is not like tweets about legal research all the time. You will likely find more things about sports than than the law. But reach out to me, text me, email me, call me. You can find me at most CLE seminars. I’m a member of the Texas Family Law Council. And so we, I’ve been doing it for about four years now. So we are the people at the booths who are selling publications, and we are the people who are doing pro bono CLE seminars. And we’re the ones that are working for family lawyers, kind of with the state bar. You can find me at any section booth at any CLE and I’d be happy to talk with you about anything.

Holly: Well, thank you so much for joining us today. For our listeners, if you enjoyed this podcast, take a second to leave us a review and subscribe to enjoy future episodes.

Voiceover: The Texas Family Law Insiders podcast is sponsored by the Draper Law Firm. We help people navigate divorce and child custody cases and handle family law appellate matters. For more information, visit our website at

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