The Strange History of a Squatter's Heights Property

There's a weird history behind this fence.EXPAND
There's a weird history behind this fence.
Photos by Michael Barajas

For at least two years, the Heights residents who lived near the vacant 731 East 8th Street complained about rats crawling around the property and the stench of gasoline. No one had occupied the parcel ever since the semi-employed lawyer who lived in a converted garage apartment, Parnell Stockstill, died of a heart attack at age 67. 

For a while, neighbor Barbara Farrell says, Stockstill parked a leaky motor home on the block, and when people complained, he moved it onto the fenced-in property, where it kept company with at least a dozen antique cars Stockstill collected: Studebakers, Cadillacs, a few T-birds. Soon, Farrell says, the fence became plastered with notices from city inspectors responding to complaints.

Farrell and another neighbor, Andy Valdez, were never really sure if Stockstill ever owned the property. He used to live across the street with a woman named Susan Phillips, and then the next thing neighbors knew, he was renovating the long-unoccupied property's squalid garage. By 1994, he was living there. And in 2012, he died there.

Stockstill had no wife, no children, no legal heirs. In 2013, his sister, Baton Rouge resident Beverly Stockstill McGehee, initiated proceedings in probate court for her and another sister, Lanell Stockstill, to become administrators of their brother's estate. In 2015, the sisters sold the property to a development company called Whitestone, for $345,000, turning a tidy profit off a rat- and junked-car-infested plot of land that had long been a neighborhood nuisance. 

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As it turns out, the sisters' windfall is part of the dark legacy of one of southeast Texas's most notorious real estate swindlers, J.R. McConnell, who committed suicide in Harris County Jail in 1988 while awaiting charges on what federal prosecutors said at the time was one of the biggest title-fraud schemes in U.S. history. According to media accounts at the time, McConnell and five others were indicted in 1987 for allegedly defrauding two Houston lending institutions out of $4.2 million, but a federal prosecutor told the Associated Press that the indictment just covered part of what was at least a $162 million house of cards. 

McConnell's companies filed for bankruptcy protection in 1986. "According to a court-appointed trustee's report, McConnell and the 10 companies he took into bankruptcy with him owed $427 million against $281 million in assets," according to an AP story. "A key part of McConnell's business, the report said, was Texas Guaranty Investments, which went bankrupt owing 1,400 investors $35 million."

Court records show that, as of August 2014, those investors — or their heirs — were still filing to recoup their payments. 

The main thrust of the scheme, according to prosecutors, was that McConnell and his partners would put up a single piece of property as collateral for a loan from multiple lenders — whether or not they actually owned the property. 

The New York Times reported on his felony-probation-to-fake-riches story in 1998:

Mr. McConnell arrived in Houston near the peak of the dizzying oil-fueled boom of the late 1970's when Houston's growth seemed to be a perpetual motion machine.

Like many others, he looked at Houston as a place to make a fresh start. Mr. McConnell had been in the real estate business in Florida but left for Texas after being sentenced to probation for a felony conviction for securities fraud involving a failed land deal in southern Florida.

As he told his story, he pulled into Houston with 23 cents in his pocket in a 1968 Camaro pulling a World War II surplus trailer with a tarpulin covering his possessions. He lived for a while off his wife's salary while doing home repair work before managing to buy a few modest rent houses. 

He was not exactly a charismatic figure with his thin frame, thinning blond hair and long sideburns, but with each success his projects grew bigger. When he opened a project on Galveston's restored 19th century street, the Strand, he brought out country singer Johnny Cash and the Houston Symphony Orchestra to mark the occasion. His last major project was to be a $900 million, 440-acre resort on Galveston Island."

He then bought some apartments. Before long he was putting together mammoth real estate deals in Houston and Galveston that made him one of the most conspicuous successes in the nation's most overheated boom town.

He had a $1 million airplane, a fleet of limousines and two dozen replica Model A Fords. He was not exactly a charismatic figure with his thin frame, thinning blond hair and long sideburns, but with each success his projects grew bigger. When he opened a project on Galveston's restored 19th century street, the Strand, he brought out country singer Johnny Cash and the Houston Symphony Orchestra to mark the occasion. His last major project was to be a $900 million, 440-acre resort on Galveston Island.

McConnell disappeared after the bankruptcy, only to surrender in November 1987 after hiding out in Mexico. The former multimillionaire claimed to have only "35 cents in his pocket when he was arrested," according to the AP. He was assigned a public defender. But after an unsuccessful suicide attempt in March 1988, McConnell somehow obtained an electrical cord, stripped it and used it to electrocute himself. 

McConnell was married but had no children. His wife, Mary Gantt, who managed to remain out of the spotlight while her husband amassed a fortune and ruined lives, slipped further into obscurity. She's a defendant in a number of Harris County tax suits, but process servers have had trouble finding her. (The Houston Press was unable to track her down for this story.)

When Stockstill's sisters sought to take over his estate, the court had to make sure any potential claimant was notified and that no one else was contesting the sisters' claim to the property. The defendants, represented by an ad litem attorney, are listed as "the unknown heirs of JR McConnell, deceased" and a host of other "unknown" defendants.

Here's where things get confusing.

The sisters' attorney, Michael Tibbets, turned up deeds that purported to show McConnell conveying interests in 731 East 8th Street to multiple parties in 1982. One of those parties was a company called Growth United Properties, which was the new name of Texas Guaranty Investors — the company that owed $35 million to 1,400 investors. 

That company dissolved in January 1988 after failing to pay franchise sales tax, yet the Harris County Appraisal District's website shows the company as being sole owner of the property since that year. (Stockstill seems to have contributed to the impression of this defunct company owning the property by incorporating his own company called Growth United Properties in 2008.) 

Now here's where things get really confusing.

The trustee in the 1982 conveyances of the property was supposedly a Houston attorney who at one time represented McConnell. Yet that attorney swore in a February 2015 affidavit that those deeds were prepared without his knowledge. (We spoke to the attorney and are leaving his name out of this cluster — frankly, the guy doesn't need the attention.) 

The bottom line is that, when Stockstill hunkered down on that property in 1993 or 1994, it was unclear who owned the property, but it was clear no one was coming after it. It's also unclear why the property didn't become part of the 1986 bankruptcy proceedings, but it's possible it slipped through the cracks.  

So in 1994, Stockstill deeded the property to a company called Spring Green, formed by his friend Susan Phillips.

"Whether Stockstill had title to give at that point is a separate question," says Adam Corral, the ad litem attorney appointed to find possible claimants. "Conveyance and recording of a deed does not necessarily convey legal title. He may have been trying to create legal title by using an exception to this rule."

Then, in 2001, Spring Green deeded the property to Stockstill. But while Phillips signed the paperwork, she told the Press she has no recollection of that. She says Stockstill tried to claim ownership of many different properties, and was always passing paperwork her way.

"He'd just give me stuff and I'd just sign it," she says. 

Stockstill's sister Beverly at first agreed to talk to us for this story, but then she didn't return calls. Tibbets, her attorney, did the same. 

Farrell, Stockstill's neighbor, told the Press that she had spoken with Stockstill about estates and wills after the death of another neighbor. She says Stockstill claimed to have his affairs in order. 

“Lo and behold, he did not have his stuff together," Farrell says.

She says that Stockstill didn't talk about his sisters much, and Phillips says Stockstill and McGehee had a falling out shortly before his death. We weren't able to explore the relationship much, since McGehee gave us the silent treatment. But before that went into effect, she told us that the real story was this: That Stockstill "had all his stuff insured for about $15 million," and that Farrell and her son stole parts off the classic cars on the property. 

"I even found where they're scamming eBay, so I have a good story for you," McGehee said cryptically. "....They keep selling and buying the same gas cap, which I'm sure was my brother's....And that's just to build up the sale...." (We reached out to Farrell for a response to this weird accusation, but we haven't heard back.) 

Farrell's the one who ultimately found Stockstill, after she and other neighbors noticed that his truck hadn't moved for days. Groceries were still inside. She says she walked through the fence and saw that Stockstill's beloved elderly dog, Six, was outside. She also smelled something foul. That something was revealed when she was able to open the door wide enough to see the lower half of Stockstill's bloated torso on the floor. She says he had had a heart attack in bed and rolled off onto that spot. 

She was able to see enough through the two narrow pathways that snaked through the home's piles of furniture, containers, and miscellaneous junk that showcased Stockstill's hoarding abilities.

“I don't know how the coroner got him out of there," she says.

That tiny living space, crowded with junk, was an apt reflection of the property's murky ownership. We're sure it won't be long before a house is built there and 731 East 8th Street will have a new occupant. We hope it serves the new owner as well as it served Stockstill and his sisters.

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