Using Joint Bank Accounts While Avoiding Litigation

Joint bank accounts come in several shapes and sizes and can be used for a number of purposes, including use by couples to manage their finances, use by adult children and their parents when mom or dad needs help paying monthly bills, and use by parents and their minor children when teaching the kids the basics about money. However, such accounts can step into complicated legal areas related to property law, questions of donor intent, and potential exposure to gift tax.

One of the most common ways that two or more people can legally own property together is through joint tenancy. Joint tenants share equal ownership of the underlying property and have the equal, undivided right to keep or dispose of the property.  Joint tenancy carries with it a right of survivorship, meaning that when one joint tenant dies, his or her property interest is extinguished and title to the underlying assets passes directly to the other joint tenants.

Joint bank accounts carry with them many of the characteristics of the joint tenancy and it is crucial depositors pay attention to these principals when opening their accounts, including a consideration of whether the joint bank account will include a survivorship provision.

This issue was addressd in a recent Washington Court of Appeals case, Taufen v. Estate of Kirpes.

In Kirpes, the court was presented with a joint bank account shared by a decedent and her friend that included a survivorship provision. The estate argued that the decedent did not intend for the account to include this provision, and that it was unilaterally added by the bank representative upon the opening of the account. The court explained that there was a rebuttable presumption that survivorship was intended when joint bank accounts were opened, and in this case the presumption was eliminated by clear and convincing evidence of contrary intent. The court looked at the the fact that the decedent was never asked about the survivorship provision, that it was added unilaterally by the employee, and that the decedent had only instructed the banker that she wanted to “open up a joint account.”


The outcome in Kirpes was a victory for the decedent’s estate in one sense, as the account was included as an asset of the estate. On the other hand, the Court of Appeals decision was announced over four years after the account owner died, so the account proceeds were unnecessarily tied up for 50 months and the estate incurred the legal fees associated with proceedings at both the trial and appellate courts. These costs and delays could have been avoided had the depositor been aware of her options (and of how to elect them) at the time the account was opened.

When Joint Bank Accounts Fail

Taufen v. Estate of Kirpes, 155 Wash App 598, 230 P2d 199 (2010)

Decedent’s estate included a joint checking account which named Decedent and Mr. Yochum as joint owners. Although Decedent made no mention of survivorship when she opened the account, the banker unilaterally elected to add a right of survivorship without discussing the matter with Decedent. Upon Decedent’s death, Mr. Yochum transferred the balance of the account to the estate after he was informed that the money in the joint account belonged solely to Decedent’s estate. Thereafter, he sued the estate for the account proceeds.

In recognizing that the essential issue before the court was whether Decedent intended to create the account with a right of survivorship, the court first acknowledged that there is a rebuttable statutory presumption that funds belonging to a deceased depositor which remain in a joint account with a right of survivorship belong to the surviving depositor unless there is clear and convincing evidence of a contrary intent. When the presumption is overcome, however, it ceases to exist and cannot be further considered.

The court determined that, although the signed account card created a rebuttable presumption of intent to create a right of survivorship, the estate met its burden of production by providing evidence that: 1) Decedent only instructed the banker that she wanted to open up a joint account, 2) Decedent never instructed the banker that there was to be a right of survivorship, 3) It was the banker who elected to create a joint account with a right of survivorship, and 4) the designation of a right to survivorship was never discussed with Decedent. Thus, the statutory presumption of intent disappeared, and judgment was entered in favor of the estate.

LESSON: The presumption of a joint bank account may be overcome with the right evidence.