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Nail v. Nail, 486 S.W.2d 761 (Tex. 1972)

Professional & Personal Goodwill

Professional or personal goodwill attaches to the person and does not exist apart from the individual’s skills, rather than the trade or the business due to that person’s professional skill or ability.

As a result, professional goodwill is not considered property and not subject to characterization. Professional goodwill terminates on that person’s death, retirement, or disablement.

Read with Finn v. Finn, there is a two prong test to determine whether goodwill attached to a professional practice is subject to division upon divorce. The goodwill must:

  1. be independent of the personal goodwill of the spouse; and
  2. have commercial value in which the marital community is entitled to share.

    Von Hohn v. Von Hohn, 260 S.W.3d 631 (Tex. App. – Tyler 2008, no pet); Finn v. Finn, 658 S.W.2d 735 (Tex. App. – Dallas 1983, writ ref’d n.r.e.).

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