Opinion
No. 446
Decided March 24, 1949.
Descent and distribution — Joint and survivorship account — Ownership passes to survivor, by virtue of contract — Death of both within 30 days after common accident — Interest of first to die passes to other — Section 10503-18, General Code.
1. Where two persons create a joint account in a financial institution and contract that the balance of the account is payable to either or to the survivor upon the death of either, the ownership of such funds, upon the death of either, passes to the survivor by virtue of the contract.
2. Where husband and wife are the owners of a joint and survivorship bank account and both die as the result of injuries suffered in a common accident within a period of thirty days after the date of such accident, the interest of the first decedent in the fund passes to the second decedent by virtue of the contract between them and the provisions of Section 10503-18, General Code, have no application to the disposition of such fund.
APPEAL: Court of Appeals for Miami county.
Mr. Ellis W. Kerr, for administrator of the estate of Gaynor Kessler, appellee.
Mr. Baird Broomhall, for administrator of the estate of Emma Kessler, appellant.
This is an appeal on questions of law from a judgment of the Probate Court of Miami county.
Gaynor Kessler and Emma Kessler, husband and wife, residents of Miami county, Ohio, both sustained injuries in a common accident in the state of Florida in December 1944. Both died as the result of the injuries within a period of 30 days after the date of the accident, the date of death of Emma Kessler being December 31, 1944, and the date of death of Gaynor Kessler being January 18, 1945. Both died intestate and without issue of their bodies.
During life, and on the date of death, Gaynor Kessler and Emma Kessler were the owners of a joint and survivorship checking account in the Tipp Citizens National Bank in the sum of $4,150.73 and the owners of a joint and survivorship savings account in the Milton Federal Savings Association in the sum of $1,505. The administrator of the estate of Gaynor Kessler included the entire sum in the accounts in the inventory; and the administrator of the estate of Emma Kessler included one-half of the accounts in the inventory of her estate. The issue arose on exceptions to the inventories in both estates.
The matter was submitted to the court on an agreed statement of facts. The trial court found the entire proceeds of the checking account and of the savings account to be assets of the estate of Gaynor Kessler, from which finding and judgment this appeal is taken.
No factual question is presented. It is agreed that the accounts were created under a joint and survivorship contract. The legal question presented is whether under joint and survivorship contracts the entire proceeds of the accounts, upon the death of Emma Kessler, passed to Gaynor Kessler, or whether, as contended by appellant, the administrator of the estate of Emma Kessler, one-half only in the proceeds of the accounts passed to Gaynor Kessler.
Appellant contends that Section 10503-18, General Code, applies. That section provides in part:
"* * * * When the surviving spouse or other heir at law or legatee dies within three days after the date of death of the decedent, or within thirty days after the date of death of such decedent if such death resulted from a common accident, the estate of such first decedent shall pass and descend as though he had survived such heir at law or legatee. * * *"
It is conceded that the death of Gaynor Kessler and Emma Kessler resulted from a common accident, and that his death occurred within 30 days after the death of Emma Kessler.
Appellant contends that this provision of the statute makes each party a survivor of the other as a matter of law and preserves to the estate of each the vested right which each had in the joint and survivorship account which they established by contract during their lifetime. We do not agree with this interpretation of the statute. The purpose of this statute was to prevent double inheritance. The effect of this provision of the statute is not to make each decedent the survivor of the other, and as a consequence, each decedent the heir of the other, but rather to deprive the second decedent from taking any part of the estate of the first decedent when death occurs under conditions set forth in the statute. In re Estate of Metzger, 140 Ohio St. 50, 42 N.E.2d 443. Furthermore, Section 10503-18, General Code, affects only the right of the second decedent to inherit any part of the "estate" of the first decedent. Ostrander, Admr., v. Preece, Admr., 129 Ohio St. 625, 196 N.E. 670, 103 A.L.R., 218. This statute operates in the field of the law of inheritance and has no application to rights vested under contract law. The accounts in question never became a part of the "estate" of Emma Kessler, deceased.
It is well established in Ohio that where two persons create a joint account in a financial institution and contract that the balance in the account is payable to either or to the survivor upon the death of either, the ownership to such funds, upon the death of either, passes to the survivor by virtue of the contract. Berberick v. Courtade, 137 Ohio St. 297, 28 N.E.2d 636; Sage, Exr., v. Flueck, 132 Ohio St. 377, 7 N.E.2d 802; Oleff, Admr., v. Hodapp, Gdn., 129 Ohio St. 432, 195 N.E. 838, 98 A.L.R., 764; In re Estate of Hutchison, 120 Ohio St. 542, 166 N.E. 687; Cleveland Trust Co. v. Scobie, Admr., 114 Ohio St. 241, 151 N.E. 373, 48 A.L.R., 182; Arthur v. Witmeyer, Exr., 39 Ohio Law Abs., 505, 53 N.E.2d 915.
A distinction is clearly drawn between cases involving "joint account" and a "joint and survivorship account." A different rule obtains with respect to joint accounts. A joint and survivorship account at the time it is created carries a present vested interest and is not affected by the laws of descent and distribution. Oleff, Admr., v. Hodapp, Gdn., supra.
Appellant cites and relies on the unreported case of Hitchcock v. Semple, decided on April 8, 1934, by the Court of Appeals for Ashland county. A motion to certify was overruled by the Supreme Court. A careful examination of that opinion shows that a factual situation was presented respecting the character of the investment. The court's decision was based on the finding of fact that the purchaser of the bonds gave instructions that the bonds should be registered in the names of the decedents The bank, however, requested the bonds to be registered in the names of the decedents, or the survivor. The court properly found that the survivorship feature was added without authority and that a joint ownership was created, and in accord with this finding the court ordered one-half of the proceeds distributed to the estates of each of the decedent owners. That case is clearly distinguishable from the facts in the instant case.
There being no error in the record prejudicial to the appellant, the judgment is affirmed.
Judgment affirmed.
MILLER, P.J., and HORNBECK, J., concur.