A Lesson in the Power of a Florida Joint Tenancy with Right of Survivorship (JTWROS) Bank Account
Boy meets Girl; Boy puts Girl’s name on his bank accounts; Girl kills Boy: can Girl get the cash? Broward County Circuit Court tells Girl no, Fourth District Court of Appeals reverses, says answer is yes.
John Russo and Michelle Julia never married, but their romantic relationship lasted several years. In June 2005, John opened an account at Bank of America in his own name and less than two weeks later, he added Michelle’s name to that account. In March 2006, John opened an investment account as well as a bank account with Charles Schwab; six weeks later, John added Michelle to those two accounts, too.
On May 19, 2006, Michelle Julia shot and killed John Russo. Less than one month had passed since her name had been added to the Schwab accounts.
Michelle Julia never deposited any cash into John Russo’s accounts, but she never personally withdrew any cash from them, either. That is, until after John died and she tried to access the accounts and was denied.
Arguments against Michelle Julia accessing the JTWROS Accounts
Arguments were made in the probate proceeding, and carried forward on appeal, that Michelle Julia should not have access to John Russo’s money because she killed him. The Florida Slayer Statute (section 732.802(2), Florida Statutes (2006)) was used to argue that Michelle’s right of survivorship in the accounts was extinguished as a matter of law. Accordingly, the accounts then became tenancies in common which would be legally distributed according to the contributions made by each tenant.
Michelle admittedly never made any contributions. Unless Michelle could prove that the accounts were intended as gifts to her by John, she had no legal right to any of their funds. Michelle never proved John gave her any part of the accounts.
The trial court denied Michelle any access to the accounts, regardless of their initial Joint Tenancy With Right of Survivorship characterization when John Russo added her name to each account. Michelle appealed.
The Appellate Court’s Opinion
On appeal, Michelle flipped the fight – Michelle argued that Florida law provides that when one person creates a joint bank account solely with their funds, it is legally presumed that the person intends a gift to the other person, his joint tenant.
Michelle argued that it was never her burden of proof to show John’s intent to gift – she argued that John’s Estate had the legal burden to show that John did not intend to do so. Moreover, that burden would be at the highest evidentiary level: that of clear and convincing evidence.
The Court of Appeals agreed, pointing out that the case law used to argue against Michelle on this issue, and relied upon by the lower court, was based upon marital property determinations and the divorce statute was not applicable to the John – Michelle situation.
Now, the issue for Michelle was to argue for the percentage of the accounts she could claim. If the appellate court recognized the accounts John set up as Joint Tenancies With Rights of Survivorship, then Michelle could legally claim everything in them. If she was legally a tenant in common, then she could claim half of their balances.
Here, the appellate court returned the case to the trial court for further proceedings, noting:
- Until Michelle is unequivocally determined to have unlawfully and intentionally killed John, the Slayer Statute cannot apply (leaving the JTWROS status as a possibility for her);
- Until the final determination is made regarding applicability of the Slayer Statute, the Estate cannot access the funds since all the accounts legally may be Michelle’s JTWROS property (and to the extent that it did so, presumably must reimburse the accounts for any withdrawals); and
- A fact finding is needed regarding whether or not clear and convincing evidence exists that John did not intend to gift the accounts to Michelle, so the case must return to the trial court for further proceedings.
Practitioner Point: Lots of time and expense is being invested by both sides in this case, which presumably would be otherwise dedicated either to the Estate’s distribution or the defendant’s criminal defense. It’s not over: this case has been returned to the trial court for further proceedings. The opinion does not provide details on the amounts in controversy; one can assume they are significant.
Sometimes, small and apparently inconsequential items like bank signature cards can explode into huge, expensive litigation matters like this one. As this case demonstrates, it’s never too early to begin planning and preparing an estate for a possible adversary proceeding with experienced probate litigation co-counsel.
Real World Point: Everyone! Check your checking account: if you don’t intend to gift that account to the other person named on it, then you need to make it crystal clear that the account is not intended as a gift. That little card that you sign at the bank doesn’t help you here.
Julia v. Russo, 33 Fla. L. Weekly D. 1688 (July 2, 2008)
Appeal from Broward County Circuit Court, Judge Mark Spieser, to the Fourth District Court of Appeals (Opn: Chief Justice Shahood; Justices Hazouri and Damoorgian concurring)