Account of Convenience or Joint Account?

             This daughter, Anne, caused an expensive mess when her Dad added Anne’s name to their Dad’s bank account. The original purpose of adding Anne’s name to the account was for her to help Dad pay his bills.

             Creating a joint bank account allows that new joint owner to take the money in the joint account for any purpose.  Here, in this case, Anne was added to an account of her father and then she used the money for purposes of buying things for herself and her daughter.  So, Anne used Dad’s money for her own purposes and not for the purposes with which Dad intended – not for his own use.

            The Court framed the legal inquiry as: “Was Dad’s money used for the purposes of caring for Dad?”  If not, then the Court will impose a constructive trust on the money in the joint bank account and then the wrongfully acting child (Anne) will have to repay the money into the estate of the Dad, so that the rest of the children or heirs can receive what they are entitled to receive, by will or intestasy.

            In this case, Anne did not treat the joint account like an account of convenience, the new joint owner (Anne) took money for the purposes of buying things for her and her daughter, and now will have to repay that money to the estate of her late father. In short, the evidence showed that Dad intended that Anne help him pay his bills, and the money in the bank account was not intended as a gift.

See case [ http://www.michbar.org/e-journal/eJournalDate/08312016]

For more information regarding the risks of joint ownership bank accounts visit our website at http://www.zeiglerlaw.com/how-to-avoid-probate.html

Or call (248) 643-9530 or email info@zeiglerlaw.com to schedule a consultation.

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