Tom McCutheon
Q: My mother died in June, 2014, before she passed away she had put my younger sister on her savings and checking accounts. My mother also left a will leaving me as executor and my other sister as co-executor. The sister who was the co-executor had seen an attorney in Athens, Alabama about the funds our mother left in the bank, this attorney told her that these funds belonged to the sister who mother put on these accounts. He stated these funds were hers and she could do what she wished, she could keep the money or divide them with the other heirs, the choice was hers. The co-executor sister hired a second attorney and she told us that the funds in those accounts had to be put in an escrow account until after the will was probated, after these funds were put into an escrow account this attorney will drop us. Which attorney is right about who these funds belong to?
Phillip
Killen, AL
A: The answer to your question is contained within the contract that the depositors signed with the bank that held the funds.
Experience dictates that the funds in the bank will belong to the person who is the survivor of the two people who were on the account. All banks require that an agreement be signed and every one that I have seen in the last twenty years just simply by default has a “joint tenants with rights of survivorship” clause. This means that the person who survives the other gets the money.
This is exactly the same type of clause that is in most deeds between married couple where a home is owned jointly during the marriage, it will go to the survivor by the terms contained in the deed. Most homes bought and owned during a marriage are bought as “joint tenants with rights of survivorship”.
I am certain that it is possible to reach another agreement with a bank that says that funds held jointly or payable to an estate or a different beneficiary or some other arrangement, but I have never seen anything other than held jointly and then owned by the survivor.
This keeps the bank out of the estate process and also out of any litigation because there is an agreement in place that protects them from having to make a decision or make an appearance in Court. Therefore, the lawyer that said that the sister gets the funds is quite probably correct but it wouldn’t do any harm to ask to see the agreement signed when the account was originally set up. Subpoenas certainly can be issued by the attorney handling the estate for a copy of that agreement.
Buckle up and drive safely.
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