Summary
In Matter of Najjar (Sanzone) (195 A.D.3d 1483, 1485 [4th Dept 2021]), the Fourth Department determined that the statutory presumption created under Banking Law § 675 was inapplicable to two Key Bank accounts and one ESL account for failure to submit signature cards or ledgers that included the required survivorship language.
Summary of this case from Sanzone v. Najjar (In re Najjar)Opinion
1076 CA 20-00398
06-11-2021
In the MATTER OF the Final Accounting of Marcia J. NAJJAR, as Co-Executor of the Estate of Rosamond M. Najjar, Deceased, Respondent-Appellant-Respondent. Donna Sanzone and Robert Najjar, Petitioners-Respondents-Appellants.
UNDERBERG & KESSLER LLP, ROCHESTER (DAVID M. TANG OF COUNSEL), FOR RESPONDENT-APPELLANT-RESPONDENT. ADAMS LECLAIR LLP, ROCHESTER (PAUL L. LECLAIR OF COUNSEL), FOR PETITIONERS-RESPONDENTS-APPELLANTS.
UNDERBERG & KESSLER LLP, ROCHESTER (DAVID M. TANG OF COUNSEL), FOR RESPONDENT-APPELLANT-RESPONDENT.
ADAMS LECLAIR LLP, ROCHESTER (PAUL L. LECLAIR OF COUNSEL), FOR PETITIONERS-RESPONDENTS-APPELLANTS.
PRESENT: PERADOTTO, J.P., CARNI, NEMOYER, WINSLOW, AND BANNISTER, JJ.
MEMORANDUM AND ORDER It is hereby ORDERED that the decree so appealed from is unanimously modified on the law by denying the cross motion, vacating the declaration, denying those parts of the motion seeking partial summary judgment dismissing the first and second causes of action and reinstating those causes of action, and granting that part of the motion seeking a declaration with respect to the Chase Bank account ending in x1702, and judgment is granted in favor of respondent as follows:
It is ORDERED, ADJUDGED AND DECREED that respondent is entitled to 100% of the proceeds of the Chase Bank account ending in x1702,
and as modified the decree is affirmed without costs.
Memorandum: Petitioners and respondent are decedent's children, and respondent and petitioner Donna Sanzone are the co-executors of decedent's estate. Petitioners commenced the instant proceeding seeking, among other things, a compulsory accounting of decedent's estate and a declaration that certain property belonged to the estate, and they asserted, inter alia, causes of action for unjust enrichment and breach of fiduciary duty. Respondent moved for partial summary judgment seeking, inter alia, a declaration that she is entitled to all of the proceeds of four bank accounts that she held jointly with decedent — two KeyBank accounts, one ESL Federal Credit Union account and one Chase Bank account — and the dismissal of petitioners’ causes of action for unjust enrichment and breach of fiduciary duty. Petitioners cross-moved for partial summary judgment seeking a declaration that the funds in the ESL Federal Credit Union account and the two KeyBank accounts are assets of the estate. The Surrogate granted respondent's motion in part and, inter alia, dismissed the unjust enrichment and breach of fiduciary duty causes of action and denied respondent's motion with respect to the four bank accounts. The Surrogate also granted petitioners’ cross motion and declared that all four bank accounts are assets of the estate. With respect to the four bank accounts, the Surrogate reasoned that respondent failed to show that she was a joint tenant with a right of survivorship pursuant to Banking Law § 675 and petitioners established those accounts were mere convenience accounts held by respondent and decedent as tenants in common. Respondent appeals and petitioners cross-appeal.
We agree with respondent on her appeal that the Surrogate erred in granting petitioners’ cross motion and declaring that all four of the bank accounts are assets of the estate, and in denying that part of her motion seeking a declaration that she is entitled to the proceeds of the Chase Bank account. Under Banking Law § 675, "[w]hen two or more persons open a bank account, making a deposit of cash, securities, or other property, a presumption of joint tenancy with right of survivorship arises" ( Matter of New York Community Bank v. Bank of Am., N.A. , 169 A.D.3d 35, 38, 93 N.Y.S.3d 7 [1st Dept. 2019], lv denied 33 N.Y.3d 908, 2019 WL 2461347 [2019] ). In order for that statutory presumption to apply, "words of survivorship must appear on the signature card or ledger that creates the bank account" ( Matter of Camarda , 63 A.D.2d 837, 838, 406 N.Y.S.2d 193 [4th Dept. 1978], citing Matter of Fenelon , 262 N.Y. 308, 186 N.E. 794 [1933] and Matter of Coddington , 56 A.D.2d 697, 391 N.Y.S.2d 760 [3d Dept. 1977] ; see Matter of Grancaric , 91 A.D.3d 1104, 1105, 936 N.Y.S.2d 723 [3d Dept. 2012] ; Matter of Costantino , 31 A.D.3d 1097, 1099, 818 N.Y.S.2d 394 [4th Dept. 2006] ). Absent the necessary survivorship language, the statutory presumption contained in Banking Law § 675 does not apply, even if the documents creating the account provide that it is a "joint" account (see Matter of Randall , 176 A.D.2d 1219, 1219, 576 N.Y.S.2d 712 [4th Dept. 1991] ; Matter of Coon , 148 A.D.2d 906, 907, 539 N.Y.S.2d 534 [3d Dept. 1989] ). Here, on her motion, respondent failed to establish that the statutory presumption created under Banking Law § 675 is applicable because she failed to submit signature cards or ledgers of the accounts that included the required survivorship language.
Because respondent "could not invoke the statutory presumption, [she] had the burden of establishing that the [bank] accounts were joint tenancies or a gift entitling [her] to rights as the survivor" ( Matter of Seidel , 134 A.D.2d 879, 880, 522 N.Y.S.2d 51 [4th Dept. 1987] ). Respondent averred in an affidavit that decedent placed her name on the accounts with the stated intention of gifting them to her. Respondent also submitted related account documents, including bank documents for all four accounts that reference both respondent and decedent's names and include survivorship or joint tenancy language. Thus, respondent submitted evidence establishing that the four accounts were joint accounts with right of survivorship, and the burden then shifted to petitioners.
In opposition to respondent's motion, petitioners submitted evidence with respect to the ESL Federal Credit Union account and the two KeyBank accounts; they did not oppose respondent's motion with respect to the Chase Bank account, and did not seek a declaration with respect to that account on their cross motion. Thus, we agree with respondent that the Surrogate erred in denying her motion with respect to the Chase Bank account and declaring that the account was an asset of the estate, and we therefore modify the decree accordingly.
In opposition to respondent's motion with respect to the ESL Federal Credit Union account and the two KeyBank accounts, petitioners submitted decedent's will, which left the estate to the three children. Thus, the intent of decedent, as evidenced by her will, is inconsistent with respondent's contention that the three bank accounts were gifts to respondent or joint tenancies with survivorship rights (see Seidel , 134 A.D.2d at 880, 522 N.Y.S.2d 51 ). Moreover, petitioners submitted respondent's deposition testimony that those three accounts were funded solely by decedent, that one of the KeyBank accounts was used as decedent's primary checking account, and that payments out of that account were for only decedent's benefit. Further, respondent, who became joint owner of those three accounts when decedent was in her mid to late eighties, testified that she helped decedent with her banking. Therefore, we conclude that petitioners raised questions of fact whether the ESL Federal Credit Union account and the two KeyBank accounts were convenience accounts, and thus, contrary to respondent's contention, the Surrogate properly denied respondent's motion with respect to those three accounts.
We agree with respondent, however, that, inasmuch as there are questions of fact with respect to the ESL Federal Credit Union account and the two KeyBank accounts, the Surrogate erred in granting petitioners’ cross motion and declaring that those three bank accounts are assets of the estate. We therefore further modify the decree accordingly.
In light of our determination that there are triable questions of fact raised with respect to the ESL Federal Credit Union account and the two KeyBank accounts, we agree with petitioners on their cross appeal that respondent did not establish that there was no unjust enrichment on her part and that she did not breach any fiduciary duty (see generally Zuckerman v. City of New York , 49 N.Y.2d 557, 562, 427 N.Y.S.2d 595, 404 N.E.2d 718 [1980] ). We therefore further modify the decree by denying those parts of respondents’ motion seeking to dismiss the causes of action for breach of fiduciary duty and unjust enrichment and reinstating those causes of action.