In the Matter of the Estate of Ingram

Brief Fact Summary.

One of the deceased’s children claimed certain accounts as a joint tenancy and did not include them in the property to be distributed through the estate.

Synopsis of Rule of Law.

1) A joint tenancy can be severed, but it must be severed during the lifetime of the tenant who wishes to sever.  2) Bank accounts that are labeled as “joint” but that do not include any language regarding a right of survivorship do not create a valid joint tenancy.

Facts.

Ingram had a savings and checking account which listed her daughter, Gazalski, as a co-signor. She also had three certificates of deposit (CDs), each of which named Gazalski as a co-tenant in joint tenancy with a right of survivorship. While her mother was alive, Gazalski had never contributed money to the account or CDs, received interest from the CDs, or used any of the money in the account for her benefit. Prior to her death, Ingram wrote a holographic will stating that she wanted her entire estate, including the bank account and CDs, divided equally among her four children. After Ingram’s death, Gazalski sold her mother’s house and car and distributed the proceeds equally among her siblings and herself, but she kept the account and CDs for herself. Gazalski’s siblings argued that her mother intended to include the account and CD in the estate. They claimed that Gazalski’s name was only on the accounts in order to pay their mother’s bills. The trial court held that the bank account and CDs were to be included in the estate and distributed evenly. Gazalski appealed.

Issue.

1) Does a will sever a joint tenancy so that the jointly held property becomes part of the estate rather than passing by right of survivorship to the joint tenant? 2) Are bank accounts valid joint tenancies when labeled as “joint” accounts?

Held.

(Summers, J.) 1) No. A joint tenancy can be severed, but it must be severed during the lifetime of the tenant who wishes to sever.  2) No. Bank accounts that are labeled as “joint” but that do not include any language regarding a right of survivorship do not create a valid joint tenancy. Joint tenancies are created by express language in the instrument and by the actions of the party creating the tenancy that demonstrate an intent for joint tenancy and the right of survivorship. Here, the language of the CDs established a joint tenancy. A joint tenancy may be severed, but it must be during the lifetime of the tenant that would wish to sever it. Once that tenant has died, the property has passed to the remaining tenant by right of survivorship and there is nothing to sever. Ingram’s will did not take effect until her death, at which time the CDs had already passed to Gazalski. There was no clear and unequivocal evidence that the CDs were held in a constructive trust, despite the language of the will and testimony of the other siblings. The CDs belong to Gazalski. The bank accounts, however, do not expressly state a right of survivorship. The word “joint” does not indicate a joint tenancy. Even without the express language, joint tenancy can be found if the grantor’s intent to create one is shown. There is no evidence in this case that Ingram intended to create a joint tenancy with right of survivorship. Trial court is affirmed in part and reversed in part; appellate court decision vacated; and case remanded.

Discussion.

The court discussed the side of the bank account signature cards that state the account was joint, but never raised the contents of the back of those cards which give the rules and regulations governing the accounts. This may have made a difference if the regulations indicated a right of survivorship.