Hypothetical One: The homestead of Ralph and Tonya R. was Ralph’s separate property, which he owned prior to their marriage. In his will, Ralph left that homestead to Kendal, his daughter by a previous marriagel. Kendal attempted to oust Tonya and his and Ralph’s son, Blake, who is twelve, from the residence. Could Kendal legally force Tonya and Blake from their home?
In Texas, upon death of the owner, the homestead is set apart for use by minor children and the surviving spouse by virtue of Texas Estates Code §102.004. That right is exclusive. Therefore, Tonya has the legal right to remain in the homestead throughout her own lifetime. Kendal cannot oust Tonya and Blake, nor can she force them to allow her to move in with them. This is true regardless of the provision in Ralph’s will leaving the property to Kendal. Texas Estates Code §§102.005, 353.051.
Hypothetical Two: At the time that Daniel P. died, he had a minor daughter, Stephanie, who lived with her mother, Daniel’s ex-wife. Daniel left his homestead to his adult son, Stanley. Stanley, who was executor, sold the house during the administration of Daniel’s estate. Daniel’s estate was insolvent, meaning the estate did not have sufficient funds to pay its debts. Daniel owed $100,000.00 in credit card debt when he died. The credit card company attempted to obtain the proceeds of the sale of Daniel P’s homestead. Who won: Stanley or the credit card company?
In this case, Stanley won. Based on the statute cited above and an Austin Court of Appeals case, National Union Fire Ins. Co. of Pittsburg, Pa. v Olsen, 920 S.W.2d 458, 461 (Tex.App.-Austin 1996, no writ) the homestead passed to Stanley free of general creditors’ claims. The existence of a minor child creates the exempt status. It didn’t matter that Stephanie did not live in the house. The same exemption would have applied if Stephanie did not exist, but Stanley, as an adult child of the decedent, was living in the homestead at Daniel’s death.
In addition, it does not matter that Stanley sold the house after his father died. The status of the homestead was determined immediately upon Daniel’s death as passing free of debt to Stanley. Thereafter, the homestead would never become subject to the decedent’s debt. Therefore, when Stanley sold the property, the proceeds were also free of his father’s debt.
Sandra W. Reed is an attorney with Katten & Benson, an Elder Law firm in Fort Worth. She lives in beautiful Somervell County, near Chalk Mountain.