Opinion
21-376.
Decided January 15, 2004.
There is one main issue remaining in regard to this contested proceeding: What is to become of the proceeds of two South Carolina bank accounts?
The Last Will and Testament of the decedent, Doris E. Goodman, named her two sons, John H. Goodman and Roger A. Goodman, as well as a grandson, Roger W. Goodman (son of Roger A. Goodman) as beneficiaries of her estate. Exclusive of the decedent's real property in Florida her will divides the decedent's property equally amongst the three beneficiaries. The current dispute before the Court revolves around ownership of the South Carolina bank accounts the decedent held jointly with her grandson Roger W. Goodman. John and Roger A. Goodman maintain they properly belong in the estate, and John H. Goodman has petitioned the Court for appointment of a separate fiduciary with limited powers to pursue additional discovery and delivery of the account proceeds. The decedent, he says, would not have placed the accounts in joint names with Roger W. Goodman, but for Roger's undue influence upon her. Alternately he argues that the accounts were established only for convenience. Roger A. Goodman joins in John W. Goodman's request. Both also seek Summary Judgment declaring the accounts are estate assets.
Extensive discovery, including the deposing of Roger W. Goodman, was previously conducted. The papers of John and Roger A. Goodman do not clarify what they believe further discovery they wish pursued.
The executor of the estate, Hugh Mecum, has entered a general denial to the allegations in the petition and cross-moves for dismissal of the petition. Not surprisingly, Roger W. Goodman supports the executor's cross motion and asks for judgment in his own favor as a matter of law.
This Court previously issued a decision on December 2, 2002 following an evidentiary hearing which resulted in the removal of Roger W. Goodman as the named executor, and substitution of the named alternate executor, Hugh Mecum. No objections to Mr. Mecum's appointment was made. The Court adopts the Findings of Fact and Conclusions of Law made in that decision, to the extent they are relevant herein.
Among other things, the Court found at the hearing as follows:
In July of 1997, John F. Goodman, husband of the decedent Doris E. Goodman, became ill and was hospitalized. Roger W. Goodman traveled to Waterloo, New York at that time. While he was here the decedent added his name to certain bank accounts she held jointly with her husband. Both John F. and Doris E. Goodman then moved to South Carolina with Roger W. Goodman. John F. Goodman, died approximately two months later.
The decedent then moved back to Waterloo, New York, where she continued to reside alone until the spring of 2000, when she again moved back with Roger W. Goodman in South Carolina. She left the bank accounts in her name jointly with Roger W. Goodman and managed all of her own personal and financial affairs following her husband's death. Prior to again leaving for South Carolina, she executed her final will. It was prepared by Sam C. Bonney who had attended to her legal needs since 1997. He found the decedent to be very much aware of what she was doing, and observed nothing to suggest that Roger W. Goodman exercised any undue influence over her. The final will substantially comports with the terms of the will made previously in November of 1999 which it replaced, with the exception that the final will specifically devised the property in Florida to Roger W. Goodman. He was named as executor in both.
Despite John and Roger A. Goodman's allegation that Roger W. Goodman excluded other family members from the decedent, there was a failure to give specifics by affidavit or by testimony at the hearing. There likewise is no attempt to reconcile this claim specifically and the claim of undue influence generally with their evidence presented at the hearing that they both maintained a close relationship with the decedent after her return to Waterloo, NY in 1997 and until her return to South Carolina in the spring of 2000. This is particularly curious considering that John H. Goodman, like the decedent, resided in Waterloo during that period while Roger W. Goodman resided in South Carolina.
Prior to her final move to South Carolina, the decedent also closed her New York bank accounts and thereafter opened new joint accounts with Roger W. Goodman in South Carolina. It is these accounts, which consisted of a joint checking account with a $5,000.00 initial deposit and a joint savings account with a $200,000.00 initial deposit that are in controversy.
The Court's decision to substitute the alternate executor for Roger W. Goodman was based upon the extreme hostility between he and the decedent's sons. The Court specifically found no evidence of wrongdoing or dishonesty on Roger W. Goodman's part.
SCPA 702(10) allows that restrictive letters may be granted "(10) . . . [for] . . . any other purpose or act deemed by the court to be appropriate or necessary in respect of the affairs of the estate, the protection thereof or to the proper administration thereof." The petition seeking appointment alleges that the current executor is inappropriate for the tasks of pursuing further discovery and the accounts because he has already refused to do so. (¶ 10 of John H. Goodman petition, dated June 3, 2003). Executor Mecum stated his reasons for not wishing to use any further estate assets to pursue the bank accounts by letter to the sons' attorney dated April 25, 2003. (Exhibit D, Roger W. Goodman motion papers). Mr. Mecum concluded there was no point in making any further efforts to pursue the bank accounts, in light of a review of the First Federal Bank of Charleston employee affidavits, wherein the bank employees showed no concerns about the mental abilities of the decedent at the time she opened the accounts; the lack of any showing of illegality or undue influence by Roger W. Goodman, and after reviewing this Court's decision regarding his appointment as substitute executor and his own personal knowledge of the decedent prior to her death.
In support of the allegation of undue influence, John H. Goodman and Roger A. Goodman offer, in addition to the evidence presented at the hearing, affidavits which allude to irrational and abusive conduct of the decedent. Lacking however, is any evidence that she was not capable of managing her own affairs, or was not cognizant of the effects of how she managed them. Estate of Gebauer, 79 Misc 2d 715 (Surr.Ct., Cattaraugus Co., 1974) aff. 51 AD2d 643 (4th Dept, 1976), or how this translates to undue influence by Roger W. Goodman. Roger A Goodman also submits a supplemental affidavit which speaks of two lawsuits in which Roger W. Goodman is involved in South Carolina. Neither is germane to the allegation of undue influence.
In contrast, the executor and Roger W. Goodman offer the affidavits of First Federal of Charleston Bank, South Carolina employees Connie Carrick and Debra Songer, who attended the opening of the joint accounts in South Carolina. (Exhibit J to Roger W. Goodman's moving papers). Miss Carrick avers that she carefully explained the types of accounts to both the decedent and the grandson including reviewing the term "right of survivorship" with them. Both Ms. Carrick and Ms. Songer averred that both the decedent was oriented as to place, date and time and appeared to be opening the accounts knowingly, willingly and without coercion or undue influence.
The Court finds the Respondents have failed to show in admissible form, sufficient factual allegations to raise a question of fact regarding their claim that Roger W. Goodman exercised undue influence over the decedent in opening the joint bank accounts in South Carolina. While they may have well established that the decedent could be exceedingly disagreeable and nasty to them and others at times, the proofs they offer fall woefully short of establishing a question of whether she was confused or disabled in her thinking processes or was in any manner unduly influenced by her grandson. Nothing they submitted rebuts the affidavits of the two bank representatives, and the presumptive propriety of the account openings. Feiden v. Feiden, 151 AD 2d 889 (3rd Dept, 1989). Most allegations rather, rest on innuendo. John and Roger A. Goodman's dissatisfaction with their mother's actions, and distaste for her grandson do not serve to support a claim of undue influence.While the Court has liberal discretion to direct discovery, additional discovery and the appointment of a separate fiduciary to pursue these bank accounts is not to be awarded simply for the asking.
The alternative argument John and Roger A. Goodman submitted was that the accounts were opened for convenience only. Before addressing that question, the threshold question must be asked of whether the provisions of the South Carolina Code or New York Banking Law § 675 govern the treatment of the bank accounts.
New York's Banking Law § 675 states that its provisions apply to deposits of cash made ". . . in or with any banking or organization or foreign banking corporation transacting business in this state". . . . The Petitioner has supplied unrebutted proof that First Federal is a domestic South Carolina bank, and that it does not transact business in New York State. Thus, per the statute itself, it has no application to the bank accounts in question.
Counsel for respondents nonetheless argues that courts have, in the past, applied New York law to foreign bank accounts, citing Estate of Syroczynski; 85 Misc 2d 57 (Erie Co, 1976) and Gimbel v. Feldman, 1996 WL 342006 (EDNY, 1996). Normally, however, ". . . title to and rights in a bank deposit standing in the name of the depositor and another are governed by the law of the place where the deposit has been made and the account is kept." 9 NY Jur 2d, Banks and Financial Institutions § 256. This Court sees no reason to deviate from that rule, and finds South Carolina's law governs these accounts. Id.; CPLR 4511. This Court thus rules as a matter of law that the South Carolina Code applies to the establishment and treatment of the bank accounts that were opened by the decedent on June 6, 2000.
South Carolina Code § 62-6-104 provides, in part: "(a) sums remaining on deposit at the death of a party to a joint account belong to the surviving party or parties as against the estate of the decedent, unless there is a writing filed with the financial institution at the time the account is created . . . which creates a different intention." Counsel for Respondents concedes that there was no writing stating a contrary intention. (Respondent's Memorandum of Law, p. 7) Therefore, the alternative argument that the accounts were opened for convenience only, fails. John and Roger A. Goodman have failed to rebut by admissible evidence the plain language of the statute, and Roger W. Goodman is accordingly entitled to full ownership of the joint bank accounts. See also, Abernathy v. Latham, 345 S.C. 106 (S.C.App. 2001).
The petition by the sons seeking appointment of a fiduciary with limited powers to pursue the South Carolina bank account is denied. Summary Judgment on ownership of the South Carolina bank accounts is granted to the petitioner Roger W. Goodman, as well as the executor Hugh Mecum. This Court finds as a matter of law that Roger W. Goodman is the sole owner of said accounts and that they are not estate assets.
THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.