## Facts

- Don and Patsy Walker and Joe and Meriam (also spelled Miriam in some sources) Eakin owned two parcels of land in Whitehouse, Texas.
- The Walkers and the Eakins transferred both parcels to a church in a transaction that included both a gift component and a sale component.
- The deed contained no language stating that the grantors reserved or retained a life estate.
- After the transfer, the church leased one of the parcels back to the Walkers and the Eakins.
- The lease provided that it would remain in effect until “the date of death of the last of the Lessees to die.”
- About four years later, the church conveyed the property interests to Kajo Church Square, Inc., and related entities (collectively, Kajo).
- One week after purchasing, Kajo notified the Walkers and the Eakins that it was terminating the lease.
- The Walkers and the Eakins sued for declaratory relief, seeking a declaration that (a) they had retained a life estate, or (b) at minimum, the lease gave them a right to occupy for life; they also asserted that termination breached the lease as written and sought related relief (including rescission theories raised in the litigation).
- Both sides moved for summary judgment; the trial court granted summary judgment for the Walkers and the Eakins, denied Kajo’s motion, and awarded the Walkers and the Eakins attorneys’ fees.
- Kajo appealed.

## Issues

1. Whether the deed, though silent, could be construed to reserve a life estate to the Walkers and the Eakins.
2. Whether a lease term that lasts until “the date of death of the last of the Lessees to die” creates a life-term leasehold or instead a tenancy at will under Texas law.
3. Whether Kajo, as a successor owner/landlord, could terminate the lease without breaching it if the lease is a tenancy at will.
4. Whether the trial court’s attorneys’ fee award in the declaratory-judgment action could be affirmed despite reversal on the merits.

## Decision

- The court of appeals reversed the trial court’s summary judgment for the Walkers and the Eakins on the merits and rendered judgment for Kajo on the substantive property/lease issues.
- The court held that no life estate existed because the deed did not expressly reserve one.
- The court held that the lease provision measured by the lessees’ lifetimes did not create an enforceable life-term lease; it created a tenancy at will.
- Because the lease was a tenancy at will, Kajo was entitled to terminate it upon notice, and termination was not a breach based on a claimed life term.
- The court affirmed the trial court’s award of attorneys’ fees to the Walkers and the Eakins.

## Legal Principles

- A life estate must be created or reserved by clear language in the instrument of conveyance; it is not implied from surrounding circumstances or from a contemporaneous leaseback.
- A lease that does not provide a definite term and instead measures duration by the life of a lessee (including “until the death of the last lessee to die”) is treated as a tenancy at will under Texas law.
- A tenancy at will is terminable by the landlord, including a successor in interest, upon proper notice; exercising that termination right is not a breach of contract.
- In a declaratory-judgment action, an attorneys’ fee award may be reviewed separately from the merits and may be affirmed even when the declaratory relief is reversed.

## Conclusion

The court of appeals held that the Walkers and the Eakins did not retain a life estate because the deed contained no express reservation, and the lease term tied to the death of the last surviving lessee created only a tenancy at will that Kajo could terminate after buying the property; the court reversed the merits judgment and rendered for Kajo, while affirming the attorneys’ fee award.


Kajo Church Square, Inc. v. Walker, 2003 WL 1848555 (2003)