Joint Tenancy vs. Estate Money
The Estate of O’Connor case came before the court to answer the question often asked and that is, when an elderly person dies with a bank account held in joint tenancy, who owns the money? The decedent’s estate or the co-owner of the account?
Here are the facts…
Creation of Living Trust
On June 27, 1990, Husband and Wife created their Family Trust. Husband and Wife (we will also call her “Mom”) had three children:
- Son #1 (we will call him “Son”)
- Son #2
The three children were equal beneficiaries of the Family Trust if they survived the surviving spouse. Husband died in 1994. Son #2 died in 2004. On August 1, 2006, Wife created the Mom-Only Trust (MOT).
Mom died in 2012. Upon Mom’s death, Daughter told the successor trustee that Mom had two Wells Fargo accounts that had been opened in October 2008 and contained approximately $477,218 at the time of Mom’s death.
Son felt that the money in the account belonged to the trust and should have been split according to the terms of the trust (remember, under the trust, the children split everything equally). But Daughter argued that the accounts did not belong to the Family Trust. Instead, she said, they were Mom and Daughter’s joint accounts while Mom was alive and now belonged entirely to Daughter as the joint owner with right of survivorship.
Joint Tenancy Issue
The court had to decide whether Mom intended to create joint accounts with the right of survivorship in favor of Daughter when she opened the accounts, thus exempting the bank accounts from the Family Trust. According to Daughter, Mom asked Daughter to meet her at the bank to open the accounts and “put my name on it with her.” Daughter testified she signed the signature card with Mom and Mom indicated the money in the accounts was for Daughter’s use. Daughter maintained she had “complete access” to the two accounts. Although Wells Fargo could not find a signed signature card for the accounts, it did find an unsigned consumer account application and legal name change request for the accounts. The consumer account application expressly listed Mom as the primary joint owner of the accounts and Daughter the secondary joint owner. Daughter later submitted a declaration stating that she had signed, and had witnessed Mom signing the consumer account application.
The case went to court. The court sided in favor of Daughter. Son appealed. On appeal, the Court of Appeal sided with Daughter again. It explained that survivorship interests in jointly-owned accounts are governed by the Probate Code. The probate code states that sums in a joint account belong to the surviving party unless there is clear and convincing evidence of a different intent.
Although Son argued that there was no sufficient evidence to support the joint tenancy nature of the accounts because there was nothing in writing, the court explained that a writing is not required to create the right of survivorship under California’s multiple-party account law. Moreover, Son was unsuccessful in overcoming the presumption by clear and convincing evidence. Although Son cited various contradictory statements made by Daughter regarding ownership of the accounts, the appellate court agreed with the lower court’s finding. In the end, the court felt there was insufficient evidence that Mom did not intend the accounts to be held in joint tenancy.
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