Joint Accounts

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    A decision reached last year gives an opportunity to review joint accounts, their uses and the ultimate beneficial ownership of their contents.

    The ordinary use of a joint bank account was first debated in Re Bishop [1965]. Although there is no question regarding the survivorship rule in relation to accounts where there are equal contributions by both parties this case involved unequal contributions. It was held in this case that the remaining contents of the account belonged to the surviving wife (although it was also decided in this case that investments bought from the joint account in the sole name of one person, belonged only to that person).

    This was expanded upon in Stoeckeart v Geddes [2004] in which it was stated that the appellant did not have a beneficial interest in the contents of the account until she had drawn upon them and, until that point, her cohabitee could terminate her right to do so at any time. In this case he had done so just prior to his death rebutting the presumption that the funds were held on a beneficial joint tenancy.

    Further cases explored the presumption of equality in relation to beneficial ownership. Later cases were decided in relation to the parties intentions, most cases either inferring equality (see Jones v Maynard [1951]) or that the account was held in joint names for convenience only (Thompson v Thompson [1970], a divorce case).

    An early example of this ‘intention’ is contained in Marshal v Crutwell [1857] where the court found that the husband had put his money into a joint account because of his failing health, allowing his wife to draw funds for expenses. It was found that the money in the account belonged to the husband’s estate.

    The most recent case in this area is Sillett v Meek [2007] in which the deceased died with a substantial £2 million estate. The deceased and the defendant had been friends for many years and Mrs Meek was appointed as executor in a Will dated 2001. She was also left a gift in the Will of £8000 (curiously accompanied with a statement that she had been left enough not to buy a ‘yacht’ but ’some holidays’). Since making the Will the deceased had opened an offshore account in joint names and when she died it contained £300,000. The defendant claimed the contents of the account belonged to her as it was the deceased’s intention that she should benefit from the survivorship rule. There were statements adduced by hearsay notice however that stated the creation of the joint account was merely to get round Luxemburg inheritance laws leaving the judge to weigh up the totality of the evidence.

    The judge said there was no indication of intention and it was held that the deceased had placed her account in joint names purely for administrative purposes.

    There was some criticism of the solicitor by the judge as there was evidence he was aware of the transfer into the account when the Will was prepared. The solicitor appeared ‘indifferent’ as to whether the account was to pass by survivorship or under the Will and had ‘lost’ the file containing the instructions.

    Clearly highlighting the need to obtain full information relating to a client’s assets and to retain client files!

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    Matt Walkden Will Writer

    About Matt Walkden

    I am a Professional Will Writer and I offer a small number of other products that complement my Will Writing such as Lasting Power of Attorneys (LPA’s), Fixed Price Estate Administration, often called Probate and some Property Products such as changing a family home from Joint owners to Tenants in Common.

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