The death of a family member can sometimes bring the remaining family members together, but death can also be the spark that ignites family disputes. Often these disputes are started by the appearance of one family member being favored unfairly over other family members. A common example is when one family member is named as a joint owner on an account and receives that entire account at the death, while the deceased person’s Will states that all assets are to be divided differently Typically, assets owned jointly pass outside of the Will… a contract of sorts that is binding and recognized as superior to the Will’s terms. The dispute begins when the living joint account owner claims that the account was made joint so that that person could claim the entire amount soon after the death, while the other family members claim that the account should be part of the estate and pass as per the terms of the Will. This dispute is even more likely when the joint account is created shortly before the deceased person’s death, giving the appearance that a sick or elderly person was misled or cajoled into excluding the other family members.
In the past, short of proof of undue influence or fraud by the surviving account holder, the money would pass to the living joint holder. This result is no longer certain. In 2007 the Pennsylvania Superior Court decided the Estate of Novosielski, 937 A.2d 449 (Pa. Super. 2007) and in 2008 the same court decided the Estate of Piet, 949 A. 2d 886 (Pa. Super. 2008). Both cases dealt with situations in which jointly held accounts were opened or made joint after the execution of a valid will. These accounts were made joint in a manner that differed from the previously executed testamentary scheme. In such cases, the Courts held that the asset in the joint account passed to the estate and not to surviving joint owner. Recently, in Estate of Alexander, 29 Fiduc. Rep. 2D 97 (O.C. Div. Allegh., 2009) the Pittsburgh Orphans’ Court followed the Novosielski and Piet cases and ordered a joint account turned over from the surviving account holder to the estate.
The court reasoned in these cases that the creation of the joint account after the will’s execution was an attempt to revoke the valid will, and such an attempt was not in accordance with recognized methods of will revocation under Pennsylvania law.
These cases appear to be an attempt to protect people at the end of their lives from a predatory family member or acquaintance who attempts to gain ownership over assets by the simple means of making an account jointly held. Undoubtedly, there are people who at the end of their lives and with clear understanding of their actions, decide to make a gift to a family member or friend that does not reflect their wills by making accounts joint.
More guidance on this issue may arrive when the Pennsylvania Supreme Court releases its decision on the appeal of the Novosielski case. Until then, when deciding to make an account joint, it is necessary to also change your Will or the gift of the account may never take place as intended.
