When you are working in expansive soil such as clay and other soils that expand with moisture content, you need to take special precautions to keep from having structural damage to the foundation and basement walls. One of these precautions is floating walls. A floating wall is not attached at top and bottom like most walls. Floating a wall is able to move with the house and keeps you from having cracks open up in your floor, foundation and walls as the moisture content in the soil changes.
Floating basement walls are usually attached to the floor joists for the first floor and then spiked to the floor allowing a space below the wall. This space is covered by the baseboards and isn’t seen.
A reverse floating wall is attached to the floor. You place the floor on the base plate on the floor and you spike it at the top so that the wall is stable but only attached at the bottom. This is done on wet walls to keep the plumbing stable. The open space is at the top of the walls and is covered by moulding. You can cover the whole wall with sheetrock but you need to take care to leave the top open for movement. This means you cannot attach drywall to the wall all of the way to the top or it will crack as the wall moves with moisture changes in the soil.
For reverse floating walls follow the basic instructions for floating a wall but instead of hanging the wall from the floor joist, you will attach the floor to the base plate and spike to the top plate. Make sure your wall is plumb. If you do not have the wall exactly square it will cause problems. A space of 4 ½ inches is needed at the top of the wall. The wall needs to be spiked in the same way as a normal floating wall too, just at the top instead of the bottom. See instructions for floating wall for more information.
To cover the open area at the top of the wall you can use moulding. Many people do not like the look of moulding around their ceiling. If you want alternatives you can look into having a drop ceiling that can move with the walls and floor. You would need to attach the framing for the ceiling to the frames for the walls. When the house breathes your whole room will move and you will not notice it.