Opinion
May 11, 1998
Appeal from the Rockland County Surrogates Court (Alfred Weiner, S.).
Stockschlaeder, McDonald Sules, P. C., New York City ( John B. McDonald, Jr., of counsel), for respondent. Burke, McGlinn Miele, Suffern ( Joseph P. McGlinn of counsel), for appellant.
The decedent, Georgina Wozniak, established two certificate of deposit accounts — so-called "Totten Trusts" — at Republic National Bank of New York. The same two individuals were named as beneficiaries of each account. One of the beneficiaries died in October of 1994. Ms. Wozniak died some two weeks later in early November of 1994.
The issue presented is whether the surviving beneficiary is entitled to all of the proceeds, or whether the deceased beneficiary's share of the trust becomes the property of the depositors estate. The Surrogate's Court adopted the latter position, holding that the surviving beneficiary was entitled to only one half of the proceeds ( see, Matter of Wozniak, 171 Misc.2d 195). We affirm.
A so-called "Totten" or tentative trust is a revocable savings account trust, in which the named beneficiaries possess a mere expectancy in the trust proceeds prior to the death of the depositor ( see, EPTL 7-5.2; Matter of Totten, 179 N.Y. 112, 125-126; see also, Blackmon v. Estate of Battcock, 78 N.Y.2d 735, 739; Matter of Bobeck, 143 A.D.2d 90, 91; 106 N.Y. Jur. 2d; Trusts, § 114, at 142). Where the beneficiary survives the depositor, the trust terminates and title to the funds vests in the beneficiary (EPTL 7-5.2, [4]). On the other hand, when the depositor survives the beneficiary, "the trust shall terminate and title to the funds shall continue in the depositor free and clear of the trust" (EPTL 7-5.2).
Applying these rules to the case at bar, we find that the trust funds should be divided between the surviving beneficiary and the depositors estate ( see, Matter of Ungara, 183 Misc. 907; cf., Matter of Sorensen, 28 A.D.2d 534; 4 Rohan, NY Civ Prac — 7-5.2). This result comports with the general principle enunciated in EPTL 7-5.2 (3), under which the depositor retains title to funds placed in trust for a predeceased beneficiary. It also reflects the tentative, contingent nature of the beneficiary's interest in the trust proceeds prior to the depositors death ( see, Blackmon v. Estate of Battcock, supra, at 739). Our conclusion is further buttressed by the absence of any directive in the trust instruments conferring a right of survivorship upon the remaining beneficiary ( see, Matter of Ungara, supra, at 908-909; see also, Matter of Totten, supra, at 124-126).
With respect to the issue of survivorship, it has been observed that "[a] statutory presumption exists in this State that a disposition of personal property (including moneys in bank accounts) to two or more persons creates in them a tenancy in common" ( Matter of Harrison, 184 A.D.2d 42, 45; see, EPTL 6-2.2 [a]; 4 Rohan, N Y Civ Prac — 6-2.2). Here, the accounts were created without any language indicating that the donor intended to create a right of survivorship in the trust proceeds. In light of the foregoing, and since the rights of the deceased beneficiary in the trust terminated upon his death, title to the subject proceeds continued in the depositors estate ( see, EPTL 7-5.2). Accordingly, the decree appealed from should be affirmed.
O'BRIEN, J. P., RITTER and JOY, JJ., concur.
Ordered that the decree is affirmed, with costs payable by the appellant to the petitioner.