In the Matter of the Estate of DeFrank, Deceased, A-4622-11T2; Appellate Division; opinion by Parrillo, P.J.A.D.; decided and approved for publication November 15, 2013. Before Judges Parrillo, Harris and Guadagno. On appeal from the Chancery Division, Probate Part, Mercer County, No. 09-01870. DDS No. 38-2-1972 [18 pp.]
Plaintiff Lorraine Rubaltelli appeals from the grant of summary judgment in favor of defendant Diane DiDonato, the executor of the estate of their mother, Aurelia DeFrank, holding that certain joint accounts in the names of decedent and defendant are nonprobate assets governed by the Multiple-Party Deposit Account Act (MPDA), and that on decedent’s death, the accounts passed outside of probate by survivorship to defendant.
That same order denied plaintiff’s cross-motion for summary judgment claiming the existence of a confidential relationship between decedent and defendant, and that at the time she established the joint accounts, decedent did not intend to create survivorship rights in defendant.
It is estimated that the parties will each inherit approximately $700,000 from their mother’s estate. That amount does not include the monies in 12 multiparty bank accounts titled jointly in the names of Aurelia DeFrank and defendant, totaling $259,407, which are the subject of this litigation.
These accounts were created by decedent between 1980 and 2001. Although jointly titled, decedent alone contributed funds to the accounts during her lifetime and all of the account statements were mailed only to her. Decedent paid the taxes on all income earned on the accounts and had the right at any time to withdraw the funds or change the designation.
Sometime after 2000, when decedent’s vision began to deteriorate, defendant would write out checks for decedent to sign. According to plaintiff, pursuant to a power of attorney (POA) decedent executed in 1991 and again in 2002 naming defendant as her attorney-in-fact, defendant would from time to time from June 2005 up to decedent’s death either assist her mother with banking transactions or directly withdraw, transfer, deposit or gift funds from the joint accounts.
In this appeal, plaintiff argues that the court erred in granting defendant’s motion for summary judgment and in denying hers because she proved by clear and convincing evidence that decedent did not intend to create a right of survivorship in the joint bank accounts in issue.
Held: In rebutting the presumption of survivorship when a party to a joint bank account dies under the Multiple Party Deposit Account Act, evidence of events occurring after the creation of the joint bank accounts may relate back to, and be indicative of, the decedent’s intent at the time the accounts were established. Moreover, where a party’s state of mind, intent, knowledge or credibility is in issue, summary judgment is ordinarily inappropriate. Neither plaintiff nor defendant was entitled to summary judgment on account of disputed facts concerning decedent’s state of mind and the nature of her relationship with the parties.
Pursuant to the MPDA, during her lifetime, Aurelia DeFrank owned all of the money in the accounts because she deposited all of the money contributed to them. However, when a party to a joint account dies, there is a rebuttable presumption that a right of survivorship was created. The statutory presumption may be overcome with evidence showing that undue influence was used in the creation of the joint accounts, or that the accounts were solely for the convenience of the depositor.
A challenge based on undue influence may be made by showing that the survivor had a confidential relationship with the party who established the account. Where a confidential relationship exists, defendant has the burden of showing that she did not use undue influence and that her mother understood the legal effect of the transfer of assets into joint accounts, namely that her assets would pass to defendant rather than in accordance with the terms of her will. Even if no undue influence is found, a trial judge should still be free to look at all the direct and circumstantial evidence available to determine whether the depositor intended to create survivorship rights.
Here, the appellate panel concludes that there is circumstantial evidence from which a fact finder could reasonably find that the joint accounts were established for decedent’s convenience during her lifetime and that she shared a confidential relationship with defendant, sufficient at the very least to raise genuine issues of fact as to both.
As to the former, plaintiff asserts her mother included defendant on the accounts out of an abundance of caution to ensure access to funds during her lifetime. Although plaintiff’s self-serving representation may be insufficient in itself to raise a factual dispute as to decedent’s true intention, the actual use of these accounts by decedent and defendant tends to support plaintiff’s claim. There is evidence—much of it in fact undisputed—that decedent used the funds in these joint accounts to pay her own expenses and to make gifts to both her daughters and grandchildren, a pattern and practice continued by defendant when she began handling her mother’s financial affairs.
There is further evidence that these inter vivos gifts were in equal amounts as were, for the most part, decedent’s testamentary dispositions—circumstantial proof from which decedent’s intention to provide for her daughters equally on her death may be inferred. Such an established pattern of equal treatment to the two children runs counter to the assumption that decedent intended to give one daughter more than $250,000 more than the other, representing 16 percent of her overall estate.
There is also evidence that defendant and her mother shared a confidential relationship. Defendant herself describes her relationship with her mother as “very close” and states it “became even closer” after her father’s death. Defendant transported her mother to doctor’s visits, the supermarket and social outings on weekends, and visited with her on a daily basis. There is evidence suggesting decedent trusted defendant with her financial affairs, having named defendant as her attorney-in-fact in two POAs executed in 1991 and 2002, and as executor of her will. Defendant acknowledged often driving her mother to the bank and assisting her in financial transactions, and further explained that she regularly transferred funds from decedent’s bank accounts and wrote out checks for her mother to sign. Such a delegation of responsibility for one’s financial affairs via the creation of joint accounts is certainly evidential of a confidential relationship between those in whose names the accounts are titled.
The appellate panel concludes that a rational fact finder could find a confidential relationship existed between defendant and her mother, or that the accounts were created for decedent’s convenience only, or both. In reaching a contrary result, the motion judge looked only at the facts and circumstances extant at the time the joint accounts were established and ignored what transpired after 2000, holding that time frame to be the only relevant one. The panel disagrees with the motion judge’s reasoning and finds the motion judge was mistaken in holding there was no evidence tending to rebut the statutory presumption of survivorship.
For appellant Lorraine Rubaltelli—Hinkle, Fingles & Prior (Eileen W. Siegeltuch on the briefs). For respondent Diane DiDonato—Wells & Singer (Jonas Singer on the brief).