Summary
holding that legatee failed to present clear and convincing evidence to overcome presumption of survivorship
Summary of this case from In re Estate of PennaOpinion
Argued May 11, 1994.
Filed: September 6, 1994.
Appeal from the Court of Common Pleas, Montgomery County, Orphans Division No. 92-1284, Stefan and Taxis, JJ.
Robert I. Tuteur, Philadelphia, for appellant.
James L. Hollinger, Norristown, for Theodore Heske, Jr., participating party.
Before McEWEN, OLSZEWSKI and DEL SOLE, JJ.
Maryanne Erhlich is the daughter of Sarah Heske, deceased, and residuary legatee of Sarah's will. Theodore Heske, Sarah's son, is also a residuary legatee of the will, but, more importantly, is the joint owner of four bank accounts established by Sarah during her life. Sarah opened the accounts exclusively with her money in 1989. In May 1991, Sarah drafted a will making no mention of the accounts and shortly thereafter executed a written document which stated that
the several certificates of deposit, including but not limited to accounts in the Meridian Bank, Continental Bank and Fidelity Bank, are owned solely by me, and that I have added my son Theodore's name to said accounts for convenience only and not as gifts inter vivos. It is contemplated that the funds in these accounts may be rolled over or reinvested at their maturities and that it shall be my continuing purpose and intent to retain sole ownership therein.
R.R. at 4a. The Orphan's Court en banc decided that Maryanne failed to overcome the presumption that, unless established otherwise by clear and convincing evidence, contents of joint accounts are intended to pass to a surviving owner. 20 Pa.C.S.A. § 6304. It thus ordered that the funds in the accounts be awarded to Theodore and, as it affects this case, excluded them from the estate's account.
Section 6304 of the Fiduciary Code is very clear:
(a) Joint Account. — Any sum remaining on deposit at the death of a party to a joint account belongs to the surviving party or parties as against the estate of the decedent unless there is clear and convincing evidence of a different intent at the time the account is created.
"Clear and convincing evidence" is the highest burden in our civil law and requires that the fact-finder be able to "come to clear conviction, without hesitancy, of the truth of the precise fact in issue." Lessner v. Rubinson, 527 Pa. 393, 400, 592 A.2d 678, 681 (1991).
Here, the case was submitted before the Orphan's Court on stipulated facts and the only evidence regarding Sarah's intent at the time she formed the accounts was the declaration she signed nearly two years after opening them. While we agree that this evidence is probative of Sarah's intent at the time the accounts were created, it is hardly clear and convincing. Sarah's attorney would have testified that "he advised the decedent that he had some reservations about the legal effectiveness of the declaration of intent." See Parties' Stipulation, ¶ 10; R.R. at 19a. Thus, the only evidence which would rebut the presumption that Sarah intended Theodore to own the accounts if he survived her is a document which could support the conclusion that Sarah had a change of heart just as easily as it could support a finding that she intended a convenience account from the start. Since our function on appeal from an Orphan's Court matter is only to determine whether the court's findings are adequately supported by the record, Estate of Shahan, 429 Pa. Super. 91, 631 A.2d 1298 (1993), we cannot find any error in the court en banc's holding.
Maryanne contends vehemently that the trial court committed an error of law by not considering the declaration at all. She contends, and we agree, that evidence procured after the account's creation is still probative of intent at the time of creation. Estate of Dembiec, 321 Pa. Super. 515, 468 A.2d 1107 (1983). The court en banc wrote in its final decree:
While Sarah W. Heske failed to evidence a "different intent" at the time she created the accounts in question, she executed subsequently a "Declaration of Intent" wherein she expressed her desire that the funds in the accounts in question be paid equally as between her daughter, Maryanne Erhlich, and her son, Theodore Heske, Jr. While the "equities" favor distribution in accordance with Sarah W. Heske's "Declaration of Intent," the clear language of the Statute precludes such a distribution.
Final Decree at 2; R.R. at 46a. After reviewing the court en banc's decree, it is reasonably clear that it actually considered the "Declaration of Intent," but simply found that it tended to prove Sarah's intention at the time she wrote the declaration, and not at the time she created the accounts. The court specifically noted that there was no positive evidence establishing Sarah's intent at the time she created the accounts and that, instead of drafting the Declaration of Intent, Sarah could changed ownership of the accounts. We cannot, therefore, fault the court below for being suspicious of Sarah's belated efforts. We agree with the court en banc that the Declaration of Intent, standing alone, is insufficient to rebut the statutory presumption.
Finally, Maryanne argues that since the accounts were rolled over in 1992, the Declaration of Intent is effective with regard to the "new" investments. We disagree. First, the parties never stipulated that the accounts were rolled over and this fact was therefore not before the court. More importantly, however, the presumption requires a party to prove her intent at the time of the accounts' "creation." There is no dispute in this case that the accounts in question were created well before the "Declaration of Intent" was signed, and we are aware of no law which elevates a decision to continue an investment to one which creates a new account. Indeed, the presumption's efficacy lies in the "assumption that most persons who use joint accounts want the survivor or survivors to have all balances remaining at death." 20 Pa.C.S.A. § 6304, Official Comment. Thus, the intent under scrutiny should be the one concomitant to the initial decision to name a joint owner — not the financial decision to remain committed to the investment.
Order affirmed.
McEWEN, J., files a dissenting opinion.
While the statement of the majority provides a thorough analysis of and persuasive expression upon the issue presented, I am obliged to dissent for I agree with the distinguished Chancellor, Judge Alfred L. Taxis, Jr., that the accounts established by the decedent were merely convenience accounts and that the accounts should, therefore, be included in the distributable estate. The Chancellor specifically found that "the Declaration of Intent is in fact clear and convincing evidence that these accounts were convenience accounts and therefore they are and should be put into Sarah Heske's estate for distribution under her Will". I too am of the mind that there was clear and convincing evidence that the decedent never intended, at the time of the creation of the accounts or at any time thereafter, to make a gift of the accounts to appellee.
As a matter of law, I cannot agree with the conclusion of the en banc trial court that the letter of intent executed by the decedent, after consultation with counsel, was "insufficient" to establish her intent at the time of the creation of the accounts. Neither the statute nor case law compels such a conclusion. The purpose of Chapter 63 of the Probate Estate and Fiduciaries Code, 20 Pa.C.S.A. § 6301 et seq., which favors the surviving party over the estate of the decedent, was the elimination of uncertainty where a joint account existed. In re Estate of Meyers, 434 Pa. Super. 165, 171, 642 A.2d 525, 528 (1994). While the statute prescribes that there must be "clear and convincing evidence" ( 20 Pa.C.S.A. § 6304) of intent to create a convenience account, the purpose of the statute was assuredly not to defeat the well-settled and clearly expressed intent of the decedent.
Clear and convincing evidence is evidence which:
is so clear, direct, weighty, and convincing as to enable the trier of fact to come to a clear conviction, without hesitancy, of the truth of the precise facts in issue.
Matter of Chiovero, [ 524 Pa. 181, 187, 570 A.2d 57, 60 (1990)]; Matter of Sylvester, [ 521 Pa. 300, 304, 555 A.2d 1202, 1203-04 (1989)]; Matter of Braig, [ 520 Pa. 409, 413-14, 554 A.2d 493, 495 (1989)]; JIRB v. Snyder, [ 514 Pa. 142, 151-53, 523 A.2d 294, 299 (1987)].
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The effects of conflicts in the evidence or corroboration of particular evidence will vary depending upon the credibility of the individuals involved, the degree of conflict or corroboration, and the importance of the point with respect to which the conflict or corroboration occurs. The existence of a conflict in the evidence with regard to a material fact, by itself, may preclude a finding that a charge has been sustained by clear and convincing evidence. See e.g. Matter of Johnson, [ 483 Pa. 227, 395 A.2d 1319 (1978)]. On the other hand, there is no mechanistic corroboration requirement; rather, a charge could be sustained on the basis of the uncorroborated testimony of a single credible witness in an appropriate case. Compare In re McDonough, 296 N.W.2d 648, 692 (Minn. 1980) ("no mechanistic corroboration requirement is necessary . . . in fact, depending on its source, uncorroborated evidence may be more reliable than that remotely corroborated by a dubious source") . . . .
Matter of Larsen, 532 Pa. 326, 333, 616 A.2d 529, 532 (1992), cert. denied, ___ U.S. ___, 114 S.Ct. 65, 126 L.Ed.2d 34 (1993) (emphasis in original). See, e.g.: Commonwealth v. Sam, 535 Pa. 350, 635 A.2d 603 (1993), cert. denied, ___ U.S. ___, 114 S.Ct. 2123, 128 L.Ed.2d 678 (1994) (defendant asserting incompetency to stand trial has the burden of establishing his or her incompetency by clear and convincing evidence); In re E.M., 533 Pa. 115, 620 A.2d 481 (1993) (existence of grounds necessary to terminate parental rights must be proven by clear and convincing evidence); Appeal of Gaus, 531 Pa. 133, 611 A.2d 696 (1992) (one who sets up the existence of a public highway has the burden of showing acceptance of the dedication by clear and convincing evidence); Moser v. DeSetta, 527 Pa. 157, 589 A.2d 679 (1991). I believe that appellant presented, under the facts of the instant case, the clear and convincing evidence necessary to overcome the statutory presumption of survivorship rights to the account in appellee.
Moreover, even if the statutory presumption operated, at the time that the decedent opened the accounts in October 1989, to impose a survivorship status upon the accounts, the statute does not declare that the presumption becomes permanent and beyond revocation. Appellee contended in the exceptions he filed to the decree nisi of the chancellor that the declaration of intent executed by the decedent on June 25, 1991, with the advice of counsel "could not apply to remove the survivorship rights of exceptant unless changes to the accounts themselves were made". The court en banc ruled, in response to the exceptions filed by appellee, that:
While the "equities" favor distribution in accordance with Sarah W. Heske's "Declaration of Intent", the clear language of the Statute precludes such a distribution. Therefore, the critical time, for purposes of the Statute, is the "time of creation". Had Sarah W. Heske desired to terminate Theodore Heske, Jr.'s survivorship rights to these accounts, Mrs. Heske should have pursued other options. She should have appeared at the bank(s), in person, to change the ownership, or if unable to do so, either by reason of physical disability or otherwise, she should have arranged for a bank official to come to her home to meet with her to change the ownership.
I disagree for, in my view, the decedent, once the accounts were opened, was free, as sole owner of the funds in the accounts, to revoke the survivorship status of the accounts by — inter alia, but only inter alia — changing the survivorship status of the record of the accounts at the banking institution — or by other clear expression of intent. I am of the mind that the decedent proceeded to just such a clear expression — a re-expression, as I see it — of intent by execution of a document, prepared by counsel pursuant to earlier delivered instructions, as a complement to a will which in itself was an implicit declaration that the accounts were but convenience accounts.
The Chancellor concluded that the Declaration of Intent established that the accounts were convenience accounts. The trial court en banc opined that the "equities" favor distribution in accordance with the "Declaration of Intent". That sound instinct of the trial court en banc triggers recollection of observations expressed in dissent a decade ago:
First, it is a principle of Biblical authenticity that fairness is the standard by which human affairs should be conducted and to which disputes should be addressed. Second, it is undisputed that a statute . . . is but a codification of the measure of fairness or equity to be applied in particular situations or to specific events. I, therefore, would urge that when the statutory prescription for equity produces grave injustice, it must bow to pervading fairness. In other words, while Themis, the goddess of justice, dearly loves all of her children, she would be quick to concede that equity demands the most care and must, therefore, receive the most protection.
Wilkins v. Heebner, 331 Pa. Super. 491, 500, 480 A.2d 1141, 1146 (1984) (McEwen, J., dissenting). Thus, it is that I conclude that the Declaration of Intent was clear and convincing evidence of decedent's intent to create convenience accounts, or, at least, ample and abundant evidence of revocation and thereby rebuttal of any statutory presumption to the contrary. Thus, I would include the accounts in the distributable estate.