Why Joint Accounts Create so Many Problems

Posted on: Friday, September 29th, 2017

Michelle Lane

Few things end up causing more litigation than accounts that are jointly owned. The problems arise when the person who created the account, and put the money into the account, dies. The issue is whether the remaining owner gets to keep the money – because they are the “surviving owner” – or whether the surviving co-owner was only placed on the account for “convenience,” in which case the funds would be distributed according to the deceased owner’s estate plan.
In two separate cases in the last several months, the Michigan Court of Appeals has issued separate cases that demonstrate how complicated the rules are for deciding the outcome of these contests. One case, In Re Estate of Morris looks at the rules for joint bank accounts. The other case, Podolak v Podolak looks at the rules that apply for joint credit union accounts. Click on the names of the cases to read these cases, or click here and here to read summaries of these cases that appear on the blog site plantobe100.com.

In the end, two pieces of advice:

1) Don’t create jointly- owned accounts unless you are quite certain that the result, if you pass, is what you intend.

2) If someone has died and you have an interest in an estate in which there is question over who should receive the money in a joint account, get advice from an attorney that is familiar with these types of cases to advocate for your position.

 

mm By: Michelle Lane
Michelle Lane

Posted in Administration