South-Western Legal Studies in Business

Joint Checking or Savings Accounts Pass Automatically on Death of One Owner
Description

Appeals court affirmed that checking and savings accounts, owned by parties who check the box declaring they wish the accounts to be joint with right of survivorship, pass immediately at the death of one owner and do not go into the estate for probate.

Topic Wills, Estates, and Trusts
Key Words

Will; Probate; Joint Accounts; Right of Survivorship

C A S E   S U M M A R Y
Facts

Roy and Sharon established joint money market savings accounts and a joint checking account at Bank of American. They both signed signature cards for each of the three accounts and marked an X next to the box that said "Joint with Right of Survivorship." The agreements stated: "All joint accounts are presumed to be joint accounts with the right of survivorship unless the applicable state law does not permit this presumption or we have otherwise agreed with you in writing that the account is owned in another capacity…. Right of survivorship means that when a co-owner dies, the balance in the account belongs to the surviving co-owner(s)…." After Roy died, the executor of his estate filed an application to probate his will and sought a court declaration that the joint accounts did not pass to Sharon because they were part of Roy's estate. The court held that the accounts were joint right of survivorship and belonged to Sharon. The executor appealed.

Decision

Affirmed. The signature card for a bank account is a contract. The language on the card stating "Joint with Right of Survivorship," next to the box marked with an X, was linked to further language in the account agreement that specified clearly that if one owner died, the account became property of the survivor. Sharon's right to these accounts was not affected by the existence of a will in the estate. Her right to the accounts was independent of probate of the estate.

Citation

In the Estate of Roy L. Wilson, ---S.W.3d--- (2006 WL 3735354, Ct. App., Tex., 2006)

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