William Powers lived to the ripe old age of 102 and prior to his death lived in his own home. Over his live he managed to accumulate $450,000 in a bank account the he, at one time, held jointly with his brother.
When his brother passed away, Mr. Powers decided to add his Niece, Marnina, as the joint owner of his bank account. The court records indicate the Mr. powers had added Marina because he needed someone to look out for him. And when advised by the bank clerk that Marina would get the money after he passed away, court records show he was comfortable with this.
Bank Documents Not Evidence
Under Canadian case law, the evidence surrounding the transfer of ownership from individual to joint with rights of survivorship must show that a gift of property was intended by the deceased.
While the evidence in the case showed that Mr. Powers did change ownership knowing that Marina would take ownership at death, the court did not view the transfer as a gift. This is because the bank registration as joint with rights of survivorship itself was only an indication that legal title was joint but was not sufficient to prove beneficial joint ownership as well.
Resulting Trust
Since Marina had been hired to care for Mr. Powers and was paid to do so, combined with an absence of other evidence proving Mr. Powers had transferred beneficial ownership to Marina, the court held that the account would pass to the estate and not to Marina.
The court deemed that Marina’s addition to the account was only for convenience and that the true intent of Mr. Powers was not to gift the account to her.
Doing It Right
These types of cases are all too common. If you intend to re-register an account into joint with right of survivorship and the intent is that person receive all of the funds in the account, then it is wise to take additional steps beyond re-registration:
Capital gain – Claiming a capital gain on the re-registration is a pretty clear indication to the courts that a gift was intended. It shows that the new owner acquired a proportional beneficial interest in the account.
Want To Read The Case?
If you are interested in reading more about this case and the specifics, lease see the court transcript here.
{ 3 comments… read them below or add one }
Just a slight correction: the link provided is to the Reasons for Judgment written by the Judge, not to the transcript of the hearing.
My father remarried and recently passed away. In his will he indicated that I’m to inherit all money left in his bank account. If he had a joint bank account with his wife and she withdrew all his money can I take her to court and sue?
Hi Jennifer,
The joint account with his wife would automatically rollover to her. You would probably not be able to challenge it. In fact if he made you the beneficiary of his estate and did not make any provisions for the wife, she could challenge the distribution and seek dependent relief – Your inheritance could possibly be delayed until her death.
Keep in mind that these are legal issues and you will get a more sound and reliable response from a lawyer.