FURTHER REFINEMENTS IN THE LAW OFJOINT BANK ACCOUNTS

I. INTRODUCTION

Joint tenancy with right of survivorship is a familiar concept. Thepurpose of this article is to disclose some of the problems whicharise when a particular asset, a bank account, is held in this form.

In the typical bank account case, one party sets up a joint bankaccount with right of survivorship with another party. Such otherparty might or might not make any deposits or withdrawals; inmany cases the other party might not even know that the accountexists.

The normal factual situation involves three basic parties. Theone who deposits the funds will be called the donor, the passiveparty will be called the donee, and the third party is the bank.These terms will be utilized because they are the most commonlyused by the courts and fit nicely into the theories relied upon in thecases.

There are two parts of a joint account - the present interestsand the right of survivorship. Under the common law most courtshold that the survivorship standing alone violates the statute ofwills so that it must be supported by a joint tenancy.'

The confusing status of the donee's interest is related to severalsources of difficulty. The first source, and the basic problemthroughout, is the inconsistency in the willingness of the courts todraw inferences concerning the donor's intent from the form of theaccount alone. The deposit agreement made with the bank- is notreally a valid indication because most often the agreement is astandard form. The second source of difficulty is the unsatisfactoryresult which flows from the use of traditional joint tenancy law,and the third is a variance in the theoretical approach of differentcourts. Typically the cases are decided by emphasizing one of thefactors and ignoring the rest.'

There are four main areas of litigation involving disputes be-tween the parties. The first three arise while both parties are stillalive. In the first situation one of the named parties to the jointaccount sues the co-depositor to recover funds withdrawn by thelatter. The second type of suit is brought to compel the restoration

1. Kepner, Five More Years of the Joint Bank Account Muddle, 26 U. CHI. L.REV. 376 (1959) [hereinafter cited as Five More Years].

2. Note, Joint Tenancy Bank Accounts Inter Vivos Rights, 23 BAYLOR L. REV.141, 146-47 (1971).

3. Comment; Property - Joint Bank Accounts - The Donee's Inter VivosInterest, 60 MICH. L. REV. 972, 974 (1962) [hereinafter cited as Joint Bank Accounts].

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of the petitioning co-depositor's (donee's) name to the account afterthe donor-depositor changes the joint account to an individualaccount. The party who has furnished the funds and who is respon-sible for opening the joint account authorizes the change from ajoint account to an individual tenancy in himself. The third type ofcase involves co-depositors who are husband and wife. There is amarital dispute and the parties have initiated proceedings leadingto a division of the property.

The final factual setting arises following the death of the donor.The survivor seeks to recover moneys not withdrawn by the de-cedent during his lifetime. It is to be noted regarding this type ofcase that the manner in which the dispute is resolved has little, ifany, bearing upon the rights of the parties to the account while bothare alive.

Courts have employed two major theories to describe the meansby which an interest in an account is transferred from the donorto the donee-beneficiary. These theories are commonly known as"gift" and "contract". The traditional gift is the most obvious andlogical transaction to which the courts analogize the joint tenancytransactions. Under gift law these requirements must be met: Thedonor must intend to make a gift, he must surrender control of theres, and there must be acceptance by the donee., The last require-ment is generally presumed to be fulfilled., The difficulty of ap-plying the traditional law of gifts is that the donor does not make agift in the traditional form - he does not surrender control of thethe funds. Oftentimes, the transfer of the balance in the accountis intended to take place as of the time of his death.' The courts donot hold that there must be absolute complete delivery becausesuch would be inconsistent with joint ownership of the funds a Ifjoint tenancy is going to be allowed then by its very nature thedelivery requirement cannot be demanded. Consequently, thequestion of the donor's intent becomes a prime consideration.

Under the contract theory, the donee-beneficiary is said to ac-quire his interest through the written deposit agreement., Mostjurisdictions view the contract as a three-party instrument insteadof a two-party agreement between the donor and the bank." Courts

4. Five More Years at 396-97.5. J. CRIBBET, PRINCIPLES OF THE LAW OF PROPERTY 115 (1962).6. C. SMITH AND R. BOYER, SURVEY OF THE LAW OF PROPERTY 469 (2d ed. 1971).7. Kepner, The Joint and Survivorship Bank Account - A Concept Without a

Name, 41 CALIF. L. REV. 596, 598 (1953) [hereinafter cited as Survivorship BankAccount].

8. Note, Jus Accrescendi and Joint Bank Accounts: A Look at the Georgia Story,7 GA. ST. B.J. 370, 373 (1971).

9. Note, Joint Tenancy Bank Accounts Inter Vivos Rights, 23 BAYLOR L. REV.141, 145 (1971).

10. Id.

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that employ this theory hold that the contract is the method oftransferring a joint interest to a donee, yet it has been suggestedthat the transaction is, in reality, a gift and that the contract is thesubstitute for delivery." The question again becomes a determina-tion of intent.

This article will analyze joint bank accounts by listing the mainissues and summarizing the methods that have been taken by thecourts in resolving them. There will be a discussion of the mannerin which the problem has been treated by legislation. To make thearticle more concrete, three recent representative cases will bediscussed. A survey will be made of the states comparing the lawof each jurisdiction. Finally, a study will be made of the law inNew York which will reveal an interesting attempt to resolve theissues and probably the best solution to the joint bank accountproblems.

II. THREE RECENT CASES

In order to better illustrate the problem and clarify the issues,three recent cases will now be discussed. The first is a Missouricase, Wantuck v. United Savings and Loan Association.'2 A declara-tory judgment action was brought to determine the ownership ofa $10,000.00 investment account represented by a certificate issuedby United Savings and Loan Association. Plaintiff, the deceaseddepositor's executor, claimed the fund for the estate, and defendant,a church, claimed as surviving joint tenant. The decedent haddeposited the money into an account, and the Savings and Loan is-sued a certificate payable to the church and decedent as jointtenants with right of survivorship. Surrender of the certificate withproof of identity was required to obtain payment. The church knewnothing of this transaction, never having seen the certificate orbeen informed of its existence until almost one year after the de-cedent's death.

The church contended the decedent's actions created a jointtenancy and that as the surviving tenant it was entitled to ownershipof the funds represented by the certificate. The plaintiff-executorcontended there was no completed inter vivos gift by the decedentto the church with the result that parties were not joint tenants withright of survivorship. The court decided the case on the basis of alack of delivery: "We hold there must be delivery to sustain a validinter vivos gift and that exception to the general rule requiringdelivery allowing for a presumption as to the presence of thatelement in cases where a family relationship exists should not be

11. Joint Bank Accounts at 978.12. 461 S.W.2d 692 (Mo. 1971).

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extended to the parties in the instant appeal. "13

The decedent surrendered neither the actual power and controlover the account nor any right with respect to it. None of his actionsindicated any change in the character of his title to the certificatefrom that of sole ownership which had existed prior to placing thechurch's name on the certificate. The Missouri supreme court heldthat there had been no valid inter vivos gift from the decedent tothe church.

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The concurring opinion in Wantuck disputed the plurality's refus-al to invoke the family relationship presumption.' He found nological basis for holding that specific acts will create a joint tenancywhere there is a family relationship between donor and donee, butthat such acts are insufficient to show delivery and create a jointtenancy when such relationship does not exist.I"

The basis upon which the concurring opinion would have deniedthe funds to the church was that, as a corporation, the church wasperpetual. It could not hold property in joint tenancy with a naturalperson because there would not be reciprocity of survivorship be-tween them. The only way a corporation can hold property withanother corporation or person is by tenancy in common. 7

In Kacirek v. Mangan,8 the Colorado court of appeals ruled thatwhen a joint tenancy account is created between one who is thesole source of the account funds and a second party, there arisesa rebuttable presumption that the one who initially possessed thefunds has made a gift.9

In Kacirek two joint tenancy accounts were formed by the de-cedent who was the original source of all funds. Sometime after-wards, the decedent-donor executed new signature cards and re-moved the name of the donee, Mangan, and placed the funds solelyunder his own name. Two questions arose: What was the effect ofthe act of creating the joint tenancy where one party was the solesource of funds, and what effect did executing the new signaturecards have on Mangan's interest? The first question has been an-swered above. In regard to the second issue, the court noted therehas been widespread confusion in the cases. It cited New York asthe emerging authority."' The view was that depositor's act of with-drawal did operate to sever and terminate the joint tenancy and to

13. Id. at 695-96,14. Id. at 697.15. Id. at 698.16. Id. at 699.17. Id. at 698.18. 489 P.2d 342 (Colo. App. 1971).19. Id. at 343.20. Id. The court cited In re Estate of Hunt, 319 N.Y.S.2d 320 (Sur. Ct. 1971).

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destroy the other joint tenant's right of survivorship, but that it didnot place the funds beyond the other joint tenant's power to claimand reach his severed interest, whatever that interest was estab-lished to be. The court found Mangan's interest must be presumedto have been a moiety or one-half of such funds, and he was allowedto claim such share from decedent's administrator.21

The third case, Georgia Savings Bank and Trust Co. v. Sims, 22 wasdecided in the United States District Court for the Northern Districtof Georgia. It is particularly interesting because Georgia recentlyabolished joint tenancy,2 yet the court spoke as if a joint tenancyexisted or that at least the tenancy effect still continued." As inKacirek, there was a sole depositor and at issue was a passbookaccount. The donor became mentally incompetent, and so the effectthe incompetency of one of the joint tenants had on the account, ifany, was to be determined. At a time when the donor was still alive,the donee contended that the funds should have been awarded toherself by virtue of such incompetency. The guardian alleged thatthe funds belonged to the estate. The court ruled that the accountwas terminated upon the adjudication of incompetency, and be-cause there was no in presenti gift, the proceeds should all go tothe guardian.5

The court in Sims stated that there was no intent on the part ofdepositor to make a gift in presenti,' I yet it implied that the sur-vivorship clause would have been effective had the donor died.7One can only wonder what was the precise nature of the passbookaccount in Sims.

21. 489 P.2d at 343-44.22. 332 F. Supp. 1306 (N.D. Ga. 1971).23. GA. CODE ANN. § 85-1002 (1970).24. 332 F. Supp. at 1310. The court cited Citizens and Southern Bank of Ga. v.

Taylor, 120 Ga. App. 353, 170 S.E.2d 447 (1969), rev'd on other grounds, 226 Ga. 15,172 S.E.2d 617 (1970), which held that:,

Joint tenancy, with its incident of survivorship, as it existed at common law,has been abolished in Georgia. Survivorship is not favored by the law of thisState and never arises by operation of law. And even though the right ofsurvivorship from a joint tenancy never arises by operation of law it is notprohibited, and a contract between the parties involved or their privies, whichexpressly or by necessary implication provides for it, may be enforced.172 S.E.2d at 620.25. Id. at 1310-11.26. Id. at 1311. The court found as a matter of law that Mrs. Lloyd had no

interest in the passbook account because Mrs. Sims made no gift in presenti and shehad control of the passbook.

27. Id. at 1311. The court further concluded that Mrs. Lloyd could not take theproceeds of the passbook account, even to the extent of one-half, because the survivor-ship clause was intended to be effective upon the death of Mrs. Sims.

There seems to be inconsistency in what the court has written. In the "Findingof Fact" there is a statement that "withdrawals . . . could be made on the orderof both or either of said named parties." Id. at 1308. Yet in the "Opinion" it is stated"there was no language giving Mrs. Lloyd the right to withdraw funds." Id. at 1311.The case is a perfect example of the confusion that surrounds this area.

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III. STATUTORY TREATMENT

A. SURVEY OF THE VARIOUS STATES

Various statutes have been enacted in this area. They havebeen classified under three categories: The bank protection type,the joint tenancy type, and the special or other type of statute.2 1

The first type, as its name implies, is for the protection of thebanks when they make payments from the accounts. The statutesinsure that the banks will not be exposed to double liability. Mostcontain language to the effect that the deposit or any part of it canbe paid to any of the parties named in the account. The donor co-depositor's status as living or dead has no bearing under thisstatute. Upon payment, the bank is discharged. -1 Bank protectionlegislation originated in New York and its statutes were widelycopied.

The joint tenancy type statute provides for a statutory joint es-tate. Requirements described in the enactment must be fulfilled.If there is compliance with the statute, certain variant rights andinterests are established.10

The third classification is a catch-all for those statutes that arepeculiar unto themselves.'

28. See Survivorship Bank Account at 604-12; Five More Years at 378-84.29. The following is a typical bank protection statute:When a deposit has been made, or shall hereafter be made, in any bank... under the names of two or more persons, payable to either, or payable tothe survivor or any survivor, such deposit ... may be paid to any of suchpersons ... and the receipt .. . shall be a valid, sufficient and complete releaseand discharge of the bank ..... yA. CODE ANN. § 6.1-72 (1966).30. The following is a typical joint tenancy statute:After any commercial or savings deposit shall be made ... by any person inthe names of such depositor and one or more other persons and in form tobe paid to any of them or the survivor of them, such deposit ... shall becomethe property of such persons as joint tenants with the right of survivorship,and the same ... shall be held for the exclusive use of such persons and maybe paid to any of them during their lifetimes or the survivor or survivors.The making of the deposit in such form shall, in the absence of fraud orundue influence, be conclusive evidence, in any action or proceeding to whicheither such bank or the surviving depositor is a party, of the intention ofthe depositors to vest title to such deposit and the additions thereto in thesurvivor or survivors. WASH. REV. CODE ANN. § 30.20.015 (1961).31. Connecticut provides a unique type of statute:(1) When a deposit has been made in this state ... in the names of two or morepersons and in form to be paid to any one or the survivor, or survivors, of them,such deposit . .. shall be held for the exclusive use of such persons and may bepaid to any of them during the lifetime of all of them or to the survivor orsurvivors after the death of one or more of them, and such payment and thereceipt ... shall be a valid and sufficient release and discharge for all paymentsso made. The making of a deposit or issuance of an account in such form shall,in the absence of fraud or undue influence, be conclusive evidence, in any actionor proceeding respecting the ownership of, or the enforcement of the obligationcreated or represented by, such deposit or account, of the intention of all of thenamed owners thereof to vest title to such deposit or account, including all

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These are the labels that have been given to the various enact-ments. Yet the fact that a statute comes within a given descriptiondoes not solve the problem. Proof of this is the fact that somejurisdictions have construed the bank protection statutes as govern-ing the property interest of the parties even though the statutes pur-port to be only for the protection of the bank. :

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Interpretations of the statutes vary - many courts have heldthat various presumptions arise from them. From jurisdiction tojurisdiction, these presumptions benefit different parties.3' Thestatutes have generally fallen short of providing a solution and inmany instances have added to the confusion.

Several articles have been written on the joint tenancy problem.Some have discussed all the states" while others have been re-stricted mainly to a particular jurisdiction.', Two of the former ar-ticles attempted to categorize the states by the type of statute eachpossessed. The results were practically identical.

The two articles listed thirty-four states as having bank protec-tion legislation,"' and one state, Kentucky," as having no enactmentwhatsoever. The interpretations which have been given to the vari-ous states were widely diverse. From state to state, the presumptionswere not consistent' 8

A survey of recent cases reveals that only twenty-four stateshave had any meaningful amount of litigation in the last ten years.The major centers of court contests were New York, California,Illinois, Missouri, Ohio, and Pennsylvania.,, Of the twenty-four,

additions and increments thereto, in such survivor or survivors. CONN. GEN. STAT.REV. § 36-3 (1962).

When any joint bank deposit or savings account has been paid on the deathof one depositor to the survivor or survivors, if the deceased has left no otherestate of sufficient value for the payment of claims, the survivor or survivors ...shall pay claims for the funeral expenses, the expenses of settling the estate anddebts due for the last sickness of the deceased from such joint deposit or account.... CONN. GEN. STAT. REV. § 36-3a (1962).32. Rose v. Hooper, 175 Neb. 645, 122 N.W.2d 753 (1963); Nelson v. Rasmussen,

164 Neb. 274, 82 N.W.2d 418 (1957).33. See Survivorship Bank Account at 622-34; Five More Years at 384.401.34. See Survivorship Bank Account at 604-37; Five More Years at 378-401; Joint

Bank Accounts at n.26.35. Note, Joint Tenancy Bank Accounts Inter Vivos Rights, 23 BAYLOR L. REV.

141 (1971); Musselman, Joint Tenancy - Savings and Loan Associations - Rose v.Hooper, 13 NEB. ST. B.J. 48 (1964); Note, Jus Accrescendi and Joint Bank Accounts:A Look at the Georgia Story, 7 GA. ST. B.J. 370 (1971); Note, Joint Tenancy -Creation of a Joint Bank Account with Right of Survivorship, 24 ARK. L. REv. 361(1970); Note, Survivorship - Joint Bank Accounts with the Right of Survivorship inNorth Carolina, 46 N.C.L. REv. 669 (1968).

36. Five More Years at 379, and nn. 6, 12-20, 23-28; Joint Bank Accounts at n. 26.37. Joint Bank Accounts at 979.38. See Joint Bank Accounts at 979-99.39. It is interesting to note that several of these high volume litigation states

have patterned their statutes and thinking along New York's view. This will be broughtout later in the article. Of the twenty-four jurisdictions being considered here, seven-

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the jurisdictions where no change took place were California,Delaware, Illinois, Kansas, Maryland, Massachusetts, Minnesota,Missouri, Oklahoma, Texas, Washington, and Wisconsin. Therewas revision or restatement in the legislation of several states with-out any appreciable change in effect: Arkansas,"' Florida,' Iowa,"Michigan,, : Ohio," Nebraska," Virginia, 6 and Colorado. 7 Utahadded a paragraph to give the bank more protection. 8 Georgia re-mained unchanged but added another statute pertaining to savingsand loan associations (building and loan associations).9 Pennsyl-vania added a portion dealing with incompetency."'

B. THE BEST ANSWER TO DATE: NEW YORK BANKING LAW, SECTION 675

New York has been a leader in recognizing the problems in thisarea. In 1964 legislation' was passed by which all the old laws wererepealed"2 and replaced by one statute. The purpose of this actionwas to eliminate many of the presumptions and different interpreta-tions. It has been noted that the few states" which had adopted thestatutory joint tenancy concept had not had the problems whichrecurred with such frequency in New York.,

teen are considered bank protection type and seven are of the joint tenancy type.The states with the unique or special statutes are not among the twenty-four. See FiveMore Years at 379, and nn. 6, 12-20, 23-28; Joint Bank Accounts at 26.

40. ARK. STAT. ANN. § 67-552 (1966).41. FLA. STAT. § 659.29 (1969).42. IOWA CODE ANN. § 524-806 (1970).43. MICH. STAT. ANN. § 23-303 (1971).44. OHIO REV. CODE ANN. § 1107.08 (1971).45. NEa. REV. STAT. § 8-136 (1970).46. VA. CODE ANN. § 6.1-72 (1966).47. COLO. REV. STAT. ANN. § 14-3-6 (1963).48. UTAH CODE ANN. § 7-3-45 (1971).49. GA. CODE ANN. § 13-2039 (1967) and GA. CODE ANN. § 16-431 (1971).50. PA. STAT. ANN. tit. 7, § 604 (1967).51. Laws of N.Y. ch. 157, § 9, (1964).52. Laws of N.Y. ch. 157, §§ 1-8 (1964).53. CAL. FIN. CODE § 852 (West 1968) ; COLO. REV. STAT. ANN. § 14-3.6 (1963);

MICH. STAT. ANN. § 23.303 (1971); Mo. ANN. STAT. §§ 362.470 and 369.150 (1968);WASH. REV. CODE ANN. § 30.20.015 (1961).

54. See In re Will of Filfilcy, 63 Misc.2d 824, 313 N.Y.S.2d 793, 796 (Sur. Ct.1970). Also, as noted earlier the now revoked statutes of New York were copied andfollowed by other jurisdictions. For the prior New York view and its effect, see DeLorenzo v. F.D.I.C., 268 F. Supp. 378, 380 (S.D.N.Y. 1967):

While I agree with defendant's contention that plaintiff's accounts do notcomply with the statutory requirement, it appears that compliance with § 852is not the only way to create a joint tenancy bank account .... [T]he purposeof the statute was to create a presumption in favor of joint tenancy where theproper language was used. But this does not mean that failure to complywith the statute would bar the creation of a joint tenancy; it would merelymake proof thereof more difficult since the party alleging the existence of ajoint tenancy could not rely on the statutory presumption ....

... It would thus appear that the purpose of the New York statute (uponwhich the California law is based) is only to ease the burden of proving thecreation of a joint bank account and is not the exclusive method of creatingsuch an account.

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The new statute provides that establishing a joint account, in theabsence of proof of contrary intent, creates a joint tenancy. Theresult is that compliance with the statute gives rise to both incidentsof a joint tenancy: The present transfer of an undivided half in-terest and the right to the whole in the ultimate survivor.

The earlier statutes5 had provided for two presumptions. Thefirst, a rebuttable presumption, left it open to the parties to disprovethat the donor intended to confer a present interest in one-half ofthe deposit on the donee-depositor. The second, a conclusive pre-sumption confined to joint depositors in savings banks, closed thedoor after the death of one of the tenants to any evidence that thedonor intended not to confer survivorship. However, there wereproblems with respect to "convenience accounts" where neitherpresent ownership nor survivorship was intended.16

The crucial language of the 1964 New York Banking Law section675 is as follows:

(a) When a deposit ... has been made ... in the name ofsuch depositor ... and another person and in form to be paidor delivered to either, or the survivor of them, such deposit...shall become the property of such persons as joint tenants andthe same... shall be held for the exclusive use of the personsso named, and may be paid or delivered to either during thelifetime of both or to the survivor after the death of one ofthem, and such payment . . . shall be a valid and sufficientrelease and discharge to the banking organization ....

(b) The making of such deposit ... in such form shall, inthe absence of fraud or undue influence, be prima facie evi-dence . . . of the intention of both depositors ... to create ajoint tenancy and to vest title to such deposit ... in such sur-vivor. The burden of proof in refuting such prima facie evi-dence is upon the party or parties challenging the title of thesurvivor.57

The effect of section 675 is that, in the absence of fraud or undueinfluence, there is created a presumption of title in the survivorof the joint tenants with the burden of proof in refutation on achallenger of such title.A Section 675 was designed to. make a uniformrule (for savings banks and commercial banks) concerning theownership interest of the surviving co-tenant and establish rules ofpresumption which more closely would approximate the probableintent of depositors who establish such accounts. 9 There is no

The Missouri courts, in interpreting a statutory provision similar to thoseof California and New York ... have reached the same results indicated supra.55. Laws of N.Y. ch. 157, § 1-8 (1964).56. In re Will of Filfiley, 63 Misc.2d 824, 313 N.Y.S.2d 793, 796-97 (Sur. Ct. 1970).57. N.Y. BANKINc LAW § 675 (McKinney 1971).58. See Poersch v. Eldridge, 36 A.D.2d 193, 319 N.Y.S.2d 749, 751 (App. Div.

1971).59. Fetters, Property Law, 20 SYRACUSE L. REV. 376, 383 (1968).

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longer any vestiage of a donor-donee relationship, the law not con-cerning itself with who created the account. Upon creation, thereis a present gift from the original donor to the joint depositor ofa moiety or one-half of the account which may be alienated uni-laterally while both are alive. Also there is a present transfer of aright of the whole fund to the survivor of the joint tenants. Thislatter right is inchoate in both tenants until the contingency of thedeath of the other occurs. 0

To come within the statute and have the presumption arise, onemust follow the statute in creating the account. 6' Where a savingsaccount such as that in question here is not made payable to "eitheror the survivor" of the two persons named in the account, or thereis evidence that the account was not intended for any purposeexcept the depositor's convenience, no presumption raisedby thestatute applies.62 Also, the statute does not prohibit a depositor fromsetting up a joint account with a purpose in mind other than thatenvisioned in the statute. By clearly indicating his intentions andthe purpose of the account one can negate any presumptions arisingunder the statute.6 3

C. THE CASE OF ExcEss WITHDRAWAL: A PROBLEM UNRESOLVED BY SECTION 675

One problem that has still bothered the courts under section675 is severance or withdrawals from the fund. The confusionarises when one depositor withdraws funds in excess of his statu-tory interest without the consent of the other. In considering thisproblem, it is important to note a joint tenancy may be altered,terminated or destroyed by agreement of both joint tenants."4 Itshould also be remembered that the relationship between the bankand depositors because of the protection afforded the bank undersection 675(a) is irrelevant to the rights of the depositors betweenthemselves.

In regard to withdrawals while both joint tenants are alive, thegeneral rule has developed that each has a right to unilaterallywithdraw one-half of the funds. Yet, the account as such is notterminated by withdrawal of one-half, and the survivor is entitledto any amount remaining even if he had already withdrawn hisone-half share.61 It would behoove the other joint tenant to with-draw his share at that point, as his survivorship right will benefithim nothing while the other joint tenant will take by survivorshipIf the non-withdrawing tenant is the first to die.

There is also a rule that, when both are alive, if one withdrawsmore than his one-half share the other can demand the return of

60. In re Will of Filfiley, 63 Misc.2d 824, 313 N.Y.S.2d 793, 798 (Sur. Ct. 1970).61. Roth v. Panessa, 62 Misc.2d 896, 310 N.Y.S.2d 694, 697 (Younkers City Ct.

1970).62. 310 N.Y.S.2d at 697.63. This would be a reasonable conclusion since the cases held that the presump-

tions under the statute do not arise unless one complies with the statutory requirements.64. In re Will of Filfiley, 63 Misc.2d 824, 313 N.Y.S.2d 793, 799 (Sur. CL 1970).65. 313 N.Y.S.2d at 798-99.

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the excess." A split of opinion develops where one of the jointtenants has withdrawn more than his moiety and the right of sur-vivorship has thereafter vested in one upon the death of the other.67

One view which has substantial authority" allows recovery of theexcess withdrawal, including it in that to which the right of sur-vivorship attaches. The withdrawal is considered a nullity. Ofcourse, if the survivor is the one who made the excessive with-drawal, he simply keeps that and is awarded the amount remain-ing in the account. If the decedent is the one who made the exces-sive withdrawal, the survivor can treat it as unauthorized and canrecover from the estate of the decedent the entire amount with-drawn," not just the excess over the moiety. At least this is the rulewhere the decedent has withdrawn the entire account. The reason-ing is as follows:

(O)nce a joint tenancy has been created, the interest of eitherjoint tenant is in the entire bank account and not in a partthereof. If one withdraws the entire account, the interest ofthe other is not thereby destroyed but equity may very wellsay that one who has withdrawn the money has become thebanker thereof.-

If the wrongdoer dies before he is held to account for the excess, heforfeits the entire account and his estate is liable for such amount.

The other view, and the one that seems more reasonable, is thatwhere an excess withdrawal has taken place, only the excess of themoiety can be recovered. In effect each gets one-half of the ac-count. 7' A recent New York case, In re Estate of Hunt,71 illustratesthis view:

In the case before us all the joint savings bonds were with-drawn and cashed by John J. Hunt who shortly thereafterdied. Surely under the circumstances of this case there must

66. 313 N.Y.S.2d at 800.67. The cases are not clear however as to the consequences when one of thejoint tenants has withdrawn more than his moiety and the right of survivorshiphas thereafter vested in one upon the death of the other. If the survivor isthe one who has withdrawn the fund, the proceeding will be by the estate ofthe deceased joint tenant against the survivor; if the decedent joint tenant isthe withdrawer, the proceeding will be by the survivor against the estate. Id.68. In re Kramer's Estate, 54 Misc.2d 459, 282 N.Y.S.2d 911, 915 (Sur. Ct. 1967),

citing Morrow v. Moskowitz, 255 N.Y. 219, 174 N.E. 460 (1931).69. [I]t is just as firmly established that the surviving depositor may recoverfrom the estate of the deceased depositor the entire amount withdrawn fromthe joint account if he elects to hold the withdrawal as unauthorized. 282N.Y.S.2d at 915.Neither depositor, it has been held, may destroy a joint account by withdrawing

all or substantially all of it. The survivor may, therefore, elect to treat the withdrawalmerely as a wrongful change in the form of account funds. Thus, his survivorship rightattaches to the entire fund. Fetters, Property Law, 20 SYRACUSE L. REV. 376, 384 (1968).

70. In re Kramer's Estate, 54 Misc.2d 459, 282 N.Y.S.2d 911, 915-16 (Sur. Ct.1967).

71. Id. See also In re Lifschultz' Will, 54 Misc.2d 289, 282 N.Y.S.2d 328 (Sur.Ct. 1967); In re Estate of Hunt, 319 N.Y.S. 2d 320 (Sur. Ct. 1971).

72. 319 N.Y.S.2d 320 (Sur. Ct 1971).

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be negated any intent on the part of John J. Hunt to keep thecharacter of joint ownership alive. In fact his will and othercircumstances indicate otherwise quite emphatically. Thus,were he alive, his moiety of one-half would doubtless be hisabsolutely and the other joint tenant would have a claim forher moiety. In view of this the court cannot understand whyafter his death the widow joint tenant should be entitled tothe entire amount. Consequently the court holds that MinaHunt, widow, is entitled to one-half of the proceeds of theUnited States Savings Bonds.-As one author suggests, severance should be recognized because

such was the right of each tenant, and the injured joint tenantshould be limited to recovering the amount remaining in the ac-count and the excess withdrawn."

D. THE PROBABLE RESULTS IN THE WANTUCK, KACIREK AND SIMS CASES

UNDER SECTION 675

An attempt will now be made to analyze the three cases de-scribed earlier, Wantuck, Kacirek and Sims, in order to determinewhat the results would have been had the cases been controlled bythe Banking Laws of New York, section 675. In Kacirek, the donortook the funds out of the joint account and put them into an accountunder his own name. The donor then died and the donee sued hisestate. The Colorado court, after citing two New York cases, 5 heldthat the surviving donee was entitled to his moiety:

The rule which we adopt, and which we view as becoming theemerging authority, is that Devine's act of withdrawal didoperate to sever and terminate the joint tenancy and to destroyMangan's right of survivorship, that it did not place the fundsbeyond Mangan's power to claim and to reach his ... moiety,that is, one-half of such funds, and he may validly claim suchshare from Devine's administrator.'7

Colorado has a joint tenancy type statute.77 It appears the result

would have been the same under the present New York law.Missouri also has a joint tenancy statute and has patterned their

statute after New York's old law.7" Reviewing the facts of Wantuck,the donor had set up a joint account with the church. The courtruled there was no inter vivos gift to the church and, therefore, novalid joint tenancy. The court turned the case on lack of delivery.

73. Id. at 322.74. Fetters, Property Law, 20 SYRACUSE L. REV. 376, 386 (1968).75. In re Kramer's Estate, 54 Misc.2d 459, 282 N.Y.S.2d 911 (Sur. Ct. 1967)

In re Estate of Hunt, 319 N.Y.S.2d 320 (Sur. Ct. 1971).76. 489 P.2d 342, 343-44 (Colo. App. 1971).77. COLO. REV. STAT. ANN. § 14-3-6 (1963).78. See note 54 supra.

1972)

CREIGHTON LAW REVIEW

Apart from the fact that the church, as a corporation, lackedcapacity to be a joint tenant, under section 675 of the New YorkBanking Law there would have been upon compliance with thestatute prima facie evidence of a joint tenancy and the vestmentof title in the tenants. The concurring opinion in Wantuck wouldhave applied the New York construction to the Missouri statute:

Secondly, I am disturbed by the fact that the General As-sembly has provided in § 369.150, V.A.M.S., that when an ac-count is established as specified in that section, a joint tenancyshall be created, and yet under the rule announced in theprincipal opinion, and in other cases on which it relies, com-pliance with that statute does not necessarily result in thecreation of a joint tenancy. This is true even though the statuteis not held unconstitutional or invalid.19

The third case, Sims, originated in Georgia, a bank protectionstatute jurisdiction.o While both joint tenants were alive, the donorwas adjudged incompetent, and after finding that the incompetencyterminated the joint tenancy, the court ruled that there was no inpresenti gift to the donee; therefore, all funds were awarded to thedonor. Under New York law, based solely on the fact that there hadbeen compliance with the statute, each tenant would have beenawarded one half of the funds in the joint account. There wouldbe no concern with whether there was an in presenti transfer.

IV. CONCLUSION

As can be seen, much confusion and inconsistency has evolvedin regard to the joint bank accounts. There has been little develop-ment among the jurisdictions toward uniform law or decisions.

New York's statute is probably the best to date. It combinesboth protection for banks and creation of a joint tenancy with theprotection of the rights thus created. The New York statute removesthe need to apply gift or contract law concepts to determine whatintentions and rights are present. If states would adopt legislationwhich provides for creation of a joint tenancy with right of sur-vivorship and specifies what are the rights and obligations of eachparty, litigation would decrease and the parties would know thatwhat they are intending is actually taking place.

P. Thomas Pogge - '73

79. 461 S.W.2d at 699.80. GA. CODE ANN. § 13-2039 (1967) and GA. CODE ANN. § 16-431 (1971).

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