Sheetrock is an acceptable 1 Hr fire resistance rated material. Given your description of where it was, and the picture I wonder if it is an attempt at providing a fire rated protection from the home next door? The picture looks like they may have blocked off any ridge vents by placing the rock and what appears to be attempted fire blocks/draft stops at the top of the rock? Were there any blocks at the bottom between the joists? Hard to tell from the picture.
There is a lot of debate going on about zero lot line homes and fire spread. I have not seen this technique though. Were there soffit vents on that side of the home? If no soffit vents could you identify the soffit material?
There are materials available for soffits that are fire resistance rated and even soffit vents that are fire resistance rated. Kind of a moot point on a zero lot line depending on the remaining materials used for the construction. A hot, fast moving fire contacting any other flammable material can negate other individually fire restance rated components. That is one of the reasons for the debate.