How does Texas law treat a surviving spouse with regard to the homestead? The Corpus Christi Court of Appeals addressed this issue in Murray v. Robinson.
Rural House surrounded by fields and trees / Photo by Reed Geiger on Unsplash
Background
Christopher Murray and his wife, Florentina, owned 78 acres of land in Travis County, which they designated as their homestead. Florentina died intestate (without a will) in 1997. Christopher continued to live on the property and claimed it as his homestead. The next year, Florentina’s only child from a prior marriage, Veronica Robinson, filed an affidavit of heirship asserting an interest in the land pursuant to Texas’ laws on intestate succession. The parties agreed that, through the intestate succession laws, Veronica inherited a 50% interest in the property.
A year after that, Christopher sued Veronica for contribution and reimbursement, foreclosure of equitable lien, and declaratory judgment. He claimed that, as a joint owner, Veronica was responsible for 50% of the taxes, insurance, and repairs for the property that Christopher paid for. He also claimed she was responsible for 50% of the principal and interest paid for a mortgage he took out on the property after Florentina’s death. Additionally, he argued Veronica was responsible for 50% of the cost of improvements to the property and reimbursement for the resulting increase in value.
At trial, Christopher testified that Florentina owed $300,000 in debts at the death, although the property was not encumbered by them. After her death, he took out two loans secured by liens on the property, one for $238,477 and $410,000. He claimed the majority of the money was to pay her debts and the rest for his own private investment, though he had no documentary evidence showing how the money was spent. He agreed none of the money went to Veronica, she did not sign the notes, and she was not personally liable on the loans.
Trial Court Verdict
The trial court sided with Veronica. The court held:
(1) The property was the marital homestead of Christopher and Florentina;
(2) Veronica was not responsible for any property taxes on the property. Christopher was occupying the property under his surviving spouse rights, meaning he was responsible for all property taxes;
(3) Veronica was not responsible for any payments (principal or interest) on the property because the proceeds of the notes were not used to purchase the property and Veronica did not receive any proceeds from the notes;
(4) Veronica was not responsible for any of the maintenance, repairs, or improvements made to the property by Christopher. Christopher was occupying the property under his surviving spouse rights, meaning he is responsible for all maintenance, repairs, and improvements made to the property; and
(5) Veronica was responsible for one-half of the insurance premiums on the structures and shall reimburse Christopher $27,510.62 for the paid premiums.
Christopher appealed.
Appellate Court Opinion
The Corpus Christi Court of Appeals affirmed.
Surviving Spouse Homestead Rights
Christopher claimed that the court erred in ruling that Veronica did not have to share in paying the property taxes, loan payments, maintenance, repairs, or improvements pertaining to the property.
When a person dies without a will and leaves behind a spouse and a child who is not also a child of the surviving spouse, Texas law provides that the deceased’s undivided one-half interest in the community estate passes to the deceased’s children. Under the Texas Constitution, a surviving spouse has the right to occupy the homestead for the remainder of his or her life. This is true whether the homestead was community property or separate property of the deceased spouse. Courts have held that this surviving spouse right of occupancy of the homestead is similar to a life tenancy, with the holder retaining rights similar to a life tenant so long as the property retains its homestead character. Given this, co-tenancy does not really exist among the life tenant and the inheriting child; instead, it is more like a life estate and a remainder interest.
Property Taxes, Improvements, Note Payments
The surviving spouse is entitled to all “fruits, rents, and revenues” obtained from the property during his life. The surviving spouse is only entitled to reimbursement from the remainderman (the children) for paying down the principal of an encumbrance on the property that existed at the time the remainderman inherited the property. The surviving spouse is responsible for paying interest on any existing encumbrances. The surviving spouse is not entitled to reimbursement for improvements or property taxes.
Christopher argued he was entitled to reimbursement because Veronica was his co-tenant. The court held that no co-tenancy exists during the spouse’s lifetime in situations where a child inherits property for which the surviving spouse maintains a homestead interest. Instead, Veronica holds only a remainder interest in the property. Thus, the laws involving contribution and tenants in common simply do not apply.
Christopher claimed he was due reimbursement for the lien principal he paid. The court disagreed, however, because none of the encumbrances existed at the time Veronica inherited the property. Veronica was not responsible to pay for encumbrances created after Florentina’s death and for which she received no proceeds.
Insurance Premiums
At trial, Veronica agreed that she was responsible for half of the insurance premiums for the structures on the property. Christopher claimed she was responsible for all insurance payments. The appellate court disagreed. There is no legal requirement that a life tenant is required to maintain insurance on the property for the benefit of the remaindermen. There was no legal authority to justify requiring reimbursement if a life tenant voluntarily insures the property.
The trial court’s verdict on all issues was affirmed.
Key Takeaways
First, this case highlights the importance of having a will at death. If Florentina had a will, it would have been her wishes–rather than Texas statutes–that dictated who would have owned at least her half the property and how. For example, had Florentina written a will leaving the property to Christopher, he would have owned 100% of the property. Relying on the intestate statutes to write one’s estate plan is a plan that forfeits control, costs additional money, and often leads to significant disputes. Take the time to have a valid will drafted to ensure your wishes are both known and carried out.
Second, understanding the Texas surviving spouse homestead right is important. When someone passes away leaving a surviving spouse, the spouse has a Constitutional right to occupy and use the homestead for the rest of their life. This is true whether the property is community or separate and is true regardless of what is written in the will. The right vested in the surviving spouse is similar to a life tenant, with the remainderman (often children either by will or intestate succession) holding a remainder interest to the property after the surviving spouse passes away.
Importantly, the surviving spouse must pay the mortgage, property taxes, and improvement/maintenance costs on the property during his or her life.
The Constitutional right ceases upon the death of the surviving spouse or when the surviving spouse ceases to voluntarily relinquish the homestead protection.
Do note the surviving minor children have the same right.
