Will Dispute Case Update – Treatment of Joint Accounts

23 November, 2012
by: Cripps Pemberton Greenish

Drakeford v Cotton & Stein [2012] EWHC 1414 (Ch)

This interesting Will dispute case looks at joint bank accounts and how they are treated on the death of one of the joint account holders.

It concerns a married couple that won £107,000 on the National Lottery and, afterwards, made mirror Wills leaving everything to the survivor and, on the death of the survivor, to their three children equally.

The husband died in 2008 and two accounts he held jointly with his wife, containing around £51,000, were transferred by the bank into the joint names of his wife and one of their children, the Second Defendant

One of the children, the Claimant, had a drinking problem and fell out with her mother and siblings following an abusive telephone call.

As a result the mother decided that she should not receive anything on her death, but she did not change her Will before she died in August 2008.

At this point the Claimant argued that the joint accounts belonged to her mother alone and therefore formed part of her estate to be distributed in accordance with her Will.

However, even though the money in the joint accounts had come entirely from the mother, there was evidence that she had told the Second Defendant that she wished her to have the funds or at least have them on her death.

The Defendants claimed that these statements had the effect of making an immediate gift to the Second Defendant or that the Second Defendant owned them jointly so that they passed to her by survivorship.

The Judge found that the statements made by the mother had the effect of creating a trust of the accounts held for them beneficially. Consequently title passed to the Second Defendant on the mother’s death by survivorship and did not form part of the estate.

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A copy of the full judgment can be found here