When planning your estate affairs it is important to keep in the forefront the role of your Executor. Good estate planning provides guidance to your Executor and clarity when it comes to administering your estate after death. Of course, preparing a will is a good first step and we invite you to call our office to discuss that step but for this purposes of this blog we are going to focus on a hot topic today being….Joint Bank Accounts.
The role of an Executor can be tasking enough without having to navigate the deceased’s “true intentions” when it comes to Joint Bank Accounts.
Typically, Joint Bank Accounts are between spouses with the presumption being that the surviving spouse would be the ultimate account holder. In this instance the “true intentions” are clear as the spouses are both utilizing the account for convenience of managing their joint household affairs so when one spouse (co-owner) dies, the surviving spouse (surviving owner) automatically becomes the sole owner of the account.
Today, we commonly see Joint Bank Accounts between a deceased and an adult child. These joint accounts are typically set up between the deceased and the adult child as a means to facilitate management of the deceased’s financial affairs while alive….this is where the waters become a bit
murky for the Executor. The Executor is in the tough position of deciphering if the account is (a) truly an account for convenience meaning the funds in the account are primarily the deceased’s funds and should form part of the deceased’s estate OR (b) the deceased’s “true intention” was to leave the balance of the account as a gift to the surviving adult child.
In the first instance (a) the majority of the funds deposited into the account are contributed by the deceased. The adult child, in his/her role as joint account holder, utilizes those funds to assist the deceased with daily financial items such as paying bills, buying groceries, paying for medical treatments, etc. In this instance, presumption can be made that the joint account is for convenience and the balance of the account is intended to form part of the deceased estate to be distributed in accordance with the deceased’s will or in the instance of no-will (intestate) in accordance with the Wills and Succession Act (Alberta).
Leaving it to your Executor to rely upon bank documents signed when the account was created can be a grey area as often times the forms are generic and unlikely to suggest any intention of one account
holder over the other.
When the intention of the deceased is unclear, disputes among surviving adult children can happen and result in lengthy and expensive litigation. AVOID confusion and GUIDE your Executor by setting out your “true intentions” with respect to joint bank accounts. We can help! Call SN Law Office today if you are considering opening a joint bank account with an adult child and/or to discuss your options for estate planning in the event a joint bank account is required in the future.
A trust is an agreement between three main parties: Grantor (sometimes referred to as a Trustmaker, Trustor or Settlor) – is the person who creates