Summary
In Abrams v. Nickel, 50 Ohio App. 500, 198 N.E. 887 (1935), Nickel and Ella Wycoff opened a joint and survivorship account.
Summary of this case from Georgia Savings Bank and Trust Company v. SimsOpinion
Decided March 4, 1935.
Banks and banking — Joint and survivorship account — Joint depositor adjudicated lunatic and guardian appointed — Agreement terminated — Equal division of account required, when.
The adjudication of lunacy and appointment of a guardian of one of the two parties to a joint and survivorship account terminates the agreement, and as each had a complete interest in the entire account, equity requires, in the absence of extraordinary circumstances, an equal division of the account between the parties involved as of the time the guardian was appointed.
APPEAL: Court of Appeals for Hamilton county.
Mr. John J. Rivers and Messrs. Fitzpatrick Quane, for plaintiff.
Mr. David L. Shannon and Mr. Roy Struble, for defendants.
This case is presented on appeal from the Court of Common Pleas of Hamilton county.
The plaintiff, Harry A. Abrams, alleges that he is the guardian of one Ella Wycoff, having been appointed March 29, 1934; that on the fifteenth of August, 1925, she, Ella Wycoff, and the defendant, William Nickel, opened a joint and survivorship account with The Cleves National Bank of Cleves, Ohio; that they had lived together for many years, that she was advanced in years, partially blind, unable to read or write, and was of unsound mind, and that she was induced and persuaded to open such account; that the defendant Nickel in April, 1934, fraudulently withdrew a large part of said joint account and redeposited the same in his own name; that such account represents the joint deposits of the parties to the account. The petition prays for an accounting, a declaration of trust, and an injunction against further withdrawals of such account.
The answer of Nickel is a general denial.
The evidence shows that Ella Wycoff and the defendant Nickel had been living together for some twenty-six years, and apparently in perfect harmony. The relationship was that of landlady and boarder. There is no substantial convincing evidence that Ella Wycoff was at the time of making the deposit of unsound mind; or so weak in mentality, in spite of her limitations, that she was not thoroughly aware of the exact nature of the transactions by which the joint and survivorship act was created. She was present when the joint account was opened, and agreed to it. There is nothing to indicate that she was overpersuaded, or unduly influenced in acquiescing in this action, or that it was not as much for her benefit as for Nickel's. For almost ten years, the account, jointly administered, was permitted to operate. The evidence shows that both parties were responsible for deposits therein.
The record shows the following statement by the assistant cashier of the bank:
"A. Mr. Nickels appeared with Ella Wycoff and stated to me he desired to make a joint account of his account; that is, of his own account, so that if anything happened to him he wanted her to have what was in the account, wanted her to have charge of the account. That was his reason for making a joint account. * * *
"A. He appeared with Ella Wycoff at the window and requested me to make a joint account, to transfer it into a joint account for the reason that if anything should happen to him that he wanted her to have the money that was in the account.
"THE COURT: And at that time there was sixty-eight dollars in there? A. The records show there was a balance of sixty-eight dollars and some odd cents in the account.
"Q. Mr. Howard, who made the deposits starting from August 15, 1925, through the last deposits these records show, to the best of your knowledge? A. To the best of my knowledge William Nickel.
"Q. He made all of them? A. To the best of my knowledge.
"Q. Do you remember of Ella Wycoff ever making any deposits? A. I don't. I do not recollect it.
"Q. And when the deposits were made the rules of your Bank required that the pass book was there? A. Yes, sir.
"Q. And who had the pass book? A. William Nickel."
The defendant Nickel claims to have supplied the entire sum constituting the account. There is some doubt as to whether this claim is substantiated by his financial condition.
An account similar to that in the instant case was considered in the case of Cleveland Trust Co. v. Scobie, Admr., 114 Ohio St. 241, 151 N.E. 373, 48 A.L.R., 182. At pages 247 and 248, the court says:
"Hence the specific question before us is not whether Green made a gift of the fund in specie, but whether he created in his sister a joint interest in the deposit equal to his own.
"Now while Annie Richardson was authorized to withdraw all or any part of the balance at any time after this account was opened, so also was Jerome C. Green. The record shows that withdrawals and deposits were made only by Green, and no deposits or withdrawals whatever were made by Mrs. Richardson during Green's life. In other words Green exercised control of the account up to the time of his death. It was because of this retention of control that the Court of Appeals held there was no delivery, actual or constructive, of the fund to his sister.
"This control, however, was not exclusive. It was just the same control that Mrs. Richardson herself was authorized to exercise. The sister's interest was equal to Green's. She could withdraw all or any part of the funds upon deposit at any time during Green's life. While the account remained in the bank and the authority to pay remained unrevoked, Green himself could make no more withdrawals than his sister. It is true that Green retained the power to revoke Mrs. Richardson's right to withdraw, but until her power was terminated by him according to the arrangement to which she had assented her authority over the deposit was equal to his own. Although Green retained control of the account she had equal control thereof subject only to his right to terminate the same."
It is true that in the Scobie case the decedent signed a bank form in which the bank was advised that the joint owner of the account was authorized to draw any part or all of the account. It would seem that this authorization did little more than is accomplished by the terms of Section 710-120, General Code, which provides as follows:
"When a deposit has been made, or shall hereafter be made in any bank or trust company transacting business in this state in the name of two or more persons, payable to either, or the survivor, such deposit or any part thereof, or any interest or dividend thereon, may be paid to either of said persons whether the other be living or not; and the receipt or acquittance of the persons so paid shall be a valid and sufficient release and discharge to the bank for any payments so made."
In the Scobie case and in the instant case the intent was to open a joint account, subject to withdrawal by either owner of the account. While both parties were in the status prevailing at the time the account was originated, each had full rights in the entire account. Although the interest was a joint interest, or joint ownership, we can find no reason for limiting the right of withdrawal to any particular fraction of the account.
What then was the effect of the adjudication of lunacy and the appointment of a guardian for Ella Wycoff? From the date of the guardianship Ella Wycoff ceased to have any authority over the account. She could make neither withdrawals nor deposits. Obviously also the guardian could not become a joint owner of the account with Nickel. The guardian was entitled to whatever interest Ella Wycoff possessed in the account, but he could not, because he was her guardian, continue the joint arrangement. An unforeseen contingency had occurred. The original arrangement could not continue. The relationship of the original parties had been broken. The effect of the appointment of the guardian was to terminate the agreement.
Now as each had a complete interest in the entire account, it is plain that the application of principles of equity requires, in the absence of some extraordinary circumstances, an equal division of the account between the parties involved.
The evidence is not convincing that any special reason exists for departing from a normal division of the balance at the time of the appointment of the guardian.
It is our conclusion, therefore, sitting as a court of chancery, applying to these facts principles of equity, that William Nickel is entitled to one-half of the balance in the account at the time of the appointment of the guardian of Ella Wycoff, and that the guardian of Ella Wycoff is entitled to one-half of such account as it existed at that time.
Decree accordingly.
HAMILTON, J., concurs.