Plan To Be 100

Spouse A owns an account at credit union.  On a certain date, Spouse A and Spouse B complete a form titled “application” in order to make Spouse B a joint owner of the account with Spouse A. The backside of that application, which provides a spot for a beneficiary to be named, is left blank.  Application is signed by both Spouse A and Spouse B.

Same date, Spouse A fills out and signs a beneficiary designation, naming child, Steven, as 100% beneficiary.  This document is signed only by Spouse A.

Spouse A dies.  Three months later, Spouse B dies.  The account titling and beneficiary designation are unchanged at time of Spouse B’s death. Steven claims his interest in the account but is blocked by Personal Representative of Spouse B’s estate.

At the time of Spouse B’s death, the account held over $400,000.

Litigation followed.

P.R. of Spouse B’s estate says that after Spouse A died, Spouse B prepared an estate plan that included a revocable trust, pour over will and general assignment (or, what they call a “comprehensive transfer document”), which assignment they claim undid the beneficiary designation and made the account subject to Spouse B’s estate plan.  They argue that Spouse B, as the survivor of a joint account, controlled the disposition.  Plus, they point out, Spouse B never signed the beneficiary designation naming Steven.

Steven offers the simple, but persuasive, response that he is the named beneficiary of an account on which both owners are deceased.

Notwithstanding, the trial court ruled against Steven, and allowed the account to be treated as part of Spouse B’s probate estate.  In this unpublished decision, the Court of Appeals affirms that outcome.

The COA opinion devolves into a discussion about how many signature lines each form contained and which boxes were checked or unchecked.  In the end, in my opinion, this case offers no legal analysis or reasoning, only a flip-of-a-coin and a it’s-the-best-you-can-do rationale to justify the trial court’s outcome.

Casebooks are filled with cases, such as this, that come about either because of bad advice from bank clerks, or confusing bank documents, or both. And, there seems to be no end in sight.

To read In Re Estate of Julianne Wagner Johnson, click on the name.

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