OWM Newsletter
April, 2010
www.owmlaw.com

 

Attorney Spotlight

John A. Koury, Jr. is a graduate of the Hill School in Pottstown, the University of Pittsburgh, and received his law degree from Duquesne University. He resides with his wife in Phoenixvlle and is the proud father of three sons and grandfather of two granddaughters.

Mr. Koury is the Managing Partner of O’Donnell, Weiss & Mattie, P.C., and his areas of practice include Land Use, Municipal, Real Estate, Banking, Corporate, Estates and Elder Law.

He has been very active in the Montgomery Bar Association as well as many community organizations; as a Former Director of Visiting Nurse Association of Pottstown and Vicinity, Past President and Director of The Schuylkill River Greenway Association, Montgomery County Community College Foundation, Former Bank Director and General Counsel to Elverson National Bank, Member of Advisory Board for National Penn Bank and as a Director of National Penn Investors Trust Company. In addition, he has served as the Solicitor for East Coventry Township, Upper Providence Township Zoning Hearing Board, and Pottstown Area Industrial Development Corp., as well as various other municipalities.

Having personally served clients in the tri-county area for over 40 years, Mr. Koury leads OWM with a strong sense of commitment to community and with high standards of professional competence.

Phone: 610-323-2800
Fax: 610-323-2845
Email: jkoury@owmlaw.com


The material in this publication was created as of the date set forth above and is based on laws, court decisions, administrative rulings and congressional materials that existed at that time, and should not be construed as legal advice or legal opinions on specific facts. The information in this publication is not intended to create, and the transmission and receipt of it does not constitute, a lawyer-client relationship.

Supreme Court Reverses Superior Court and Rescues Jointly-Registered Financial Accounts

Is a joint account with two or more parties as co-owners with the right of survivorship registered with a financial institution, such as a joint checking account, savings account or certificate of deposit, legally owned by the surviving co-owners upon the death of the co-owner who contributed all the funds to the joint account? YES.

Do the provisions of a prior Will and its distribution scheme for gifting of assets of the co- owner, who later establishes the joint account change this result? NO.

Is this result contrary to the Pennsylvania Multiple-Party Accounts Act? NO.

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In Pennsylvania, a joint account in a financial institution, which is registered in the names of two or more parties, is governed by the Multiple-Party Accounts Act (“MPPA”), 20 Pa.C.S. §§6301-6306. Where one of the parties to the account dies, the MPAA provides that "any sum remaining on deposit at the death of the party . . . belongs to the surviving party as against the estate of the decedent unless there is clear and convincing evidence of a different intent a the time the account is created."

In a 2008 controversial decision, the Pennsylvania Superior Court, in the case of In re Estate of Alice G. Novosielski, Deceased, appeared to hold that "clear and convincing evidence" sufficient to overcome the MPPA presumption of survivorship will exist simply when a court determines that that the provisions of a pre-existing will of the deceased party, who created the joint account, provides for a different disposition of the deceased’s property. In other words, the Superior Court viewed the provisions of the previously executed will as trumping the statutory-presumed survivorship provisions of the MPPA. The decision caused considerable concern and changes in policies among lawyers, financial institutions and joint account holders. At the very least, every time a party with an existing will created a joint account, consideration of the provisions of the will was required to be certain that the party's property, which may pass to a surviving account holder pursuant to the MPPA survivorship presumption, would be consistent with the disposition scheme under the party's will.

However, on March 25, 2010, those concerns appear to have been put to rest when the Pennsylvania Supreme Court, reversed the Superior Court’s decision in Novosielski.

  • The facts in Novosielski involved property which was owned jointly at the time of the decedent’s death, but which had been individually owned by the decedent at the time she signed her earlier Will.

  • The change in ownership from individual to joint, said the Superior Court, changed the distribution scheme as originally contemplated by the decedent’s Will. The Superior Court’s decision would require the executor of decedent’s Will to claim the jointly owned property as being part of the probate estate effectively voiding the decedent's later registration of the property as jointly owned.

  • The clear intention of the decedent, as evidenced by the joint ownership scheme with survivorship attaching, was to change the distribution scheme as to the ownership of the decedent’s property as contemplated by the decedent’s earlier Will. Such intention would have been disregarded had the Supreme Court not reversed the Superior Court.

Some of the major points of the Supreme Court's opinion are:

  1. Wills by statutory provision do not have primacy over the right of survivorship presumed by the MPAA or the Probate, Estates and Fiduciaries Code;
  2. The legislative intent of the MPAA clearly confirms that joint accounts are governed and interpreted separate and apart from provisions governing Wills;
  3. Clear and convincing evidence of a different intent as to a distribution scheme from a prior Will cannot be concluded from its mere conflict with the conflicting scheme under a later joint account.

How to provide "clear and convincing" evidence of your intent in disposing of your property upon death:

  • Provide your attorney with complete information relating to all assets in which you have an ownership interest in your name and also with others.
    Advise any heir whom you intend to benefit as a joint owner of your intentions as to ownership of that asset.

  • Be clear and label “convenience accounts” defined as joint accounts created so that one individual is so listed as a joint owner for the limited purpose of mechanically writing checks for another but with no true and enforceable ownership interest intended.

  • Be certain that your attorney includes in your Will a separate provision stating that any assets held by you jointly with a right of survivorship are not controlled by your Will, regardless whether registration of the joint asset occurred before or after the date of the Will.

  • Understand that your Will does not control the jointly registered assets regardless of when the assets were jointly registered (whether before or after you signed your Will).

  • Understand that accounts held in trust with you as trustee are not controlled by your Will, but are controlled by a separate trust document, usually and most commonly by a signature card contract with a financial institution setting forth terms with which you should be familiar and discuss with an attorney.

If you have any questions regarding the joint ownership of accounts or other assets and the Multiple- Party Accounts Act and the case law which interprets and applies its provisions, contact your attorney to discuss your specific circumstances before you establish such joint accounts, change any titles, or execute or revise your Will.


UPCOMING EVENTS

Read Legal Ease in Sunday's Edition of the Pottstown Mercury

See Legal Talk, brought to you by OWM, on PCTV, Tuesdays at 8:30 on Channel 28, and Thursdays at 9:30 p.m. on Channel 98

O'Donnell,Weiss & Mattei, P.C.

41 E. High Street
Pottstown, PA 19464
610-323-2800
Fax: 610-323-2845

347 E. Bridge Street
Phoenixville, PA 19460
610-917-9347
Fax: 610-917-9348

www.owmlaw.com