Opinion ID: 32608
Heading Depth: 3
Heading Rank: 3

Heading: Perry's Interest in the 26-Acre Tract

Text: 31 Title to the 26-acre tract was thus in the name of the Corporation at the time of the bankruptcy filing, as evidenced by a title search presented to the bankruptcy court. Perry no longer possesses an ownership interest in the 26-acre tract. Under Texas law, however, a claimant need not hold the property in fee simple in order to invoke homestead protection. Resolution Trust Corp. v. Olivarez, 29 F.3d 201, 205 (5th Cir.1994). Villarreal v. Laredo Nat'l Bank, 677 S.W.2d 600, 606 (Tex.App.1984). Following the 1985 transfer, Perry continued to reside on the property. He thus maintained a possessory interest in the 26-acre tract. 13 32 As the district court correctly held, when coupled with occupancy of the property, [a] homestead may attach to any possessory interest, subject to the inherent characteristics and limitations of the right, title or interest in the property. Harris County Flood Control Dist. v. Glenbrook Patiohome Owners Ass'n, 933 S.W.2d 570, 577 (Tex.App.1996). 14 33 According to the Texas Supreme Court, [i]t is ... a well-recognized principle of law that one's homestead right in property can never rise any higher than the right, title, or interest that he owns in the property attempted to be impressed with a homestead right. Olivarez, 29 F.3d at 205 (quoting Sayers v. Pyland, 139 Tex. 57, 161 S.W.2d 769, 773 (1942)). Perry's interest in the property, immediately following the 1985 transfer, became one of a tenant-at-will. See Olivarez, 29 F.3d at 205 (noting that couple who occupied property without title, but with permission of the title holder, became tenants at will)(citing DeGrassi v. DeGrassi, 533 S.W.2d 81, 87 (Tex.Civ.App.1976)). Accord Shepler, 563 S.W.2d at 385-86 (holding that claimants who transferred title to a corporation, but continued to reside on the property, became tenants at will). Perry may thus claim a limited homestead interest in the 26-acre tract premised upon his at-will tenancy. A homestead interest in the possessory estate of a tenancy at will protects Perry's possessory interest in the 26-acre tract against all creditors — except the owner, or one with better title. Cleveland v. Milner, 141 Tex. 120, 170 S.W.2d 472, 475 (1943). 34 [T]he homestead interest in the possessory estate of a tenancy at will ... [would] survive judicial foreclosure of the deed of trust and sale of the property, but the longevity of [that] estate [would] depend ultimately upon the decision of the new fee title owner, at whose option the tenancy at will [might] be terminated or extended. 35 Olivarez, 29 F.3d at 205 (quoting Shepler, 563 S.W.2d at 386). Thus, just as Perry currently remains on the 26-acre tract with the permission of the Corporation, his continued possession of the property will depend upon the will and whim of any subsequent owner. 15 36