Dividing the Intangible: An Examination of Community Property in a World of Contingent Revenue

Abstract

This Comment starts with an introduction in Part I. Part II of this Comment follows the history, policies, and principles governing community property systems, and explores how community property states, especially Texas, go about characterizing property at the time of divorce. Although minimally referencing other community property states—in order to highlight how the law varies within each—this Comment will primarily focus on Texas law to encourage the proposed legislation. Part III analyzes the unique features of modern contingent revenue and explains why Texas law must recognize its distinction from traditional contingent revenue. Part IV argues that in order to safeguard and promote human creativity, avoid disproportionate awards, and protect the freedom to divorce, modern contingent revenue must be characterized as separate property at the time of divorce. Part V lays out and explains this Comment’s legislative proposal, which will enact a new presumption that validates modern contingent revenue as separate property, and a reverse burden of proof, making the non-creating spouse bear the burden to prove that such property is part of the community.