The Story of the Credit Union Signature Card.
The Wyoming Supreme Court took up a case regarding an executed signature card on a checking account. In the case, Mr. and Mrs Fleig executed a signature card at a credit union. The signature card did not indicate whether the account would be subject to rights of survivorship. However, the Membership and Account Agreement provided that joint accounts had rights of survivorship unless otherwise indicated on the signature card.
Mr. and Mrs. Fleig were married in 1992. During most of their marriage, they kept their property and bank accounts separate and each paid a portion of household bills out of their respective accounts. In April of 2015 Mr. Fleig drove Mrs. Fleig to the credit union and they met with a teller at the credit union. Mr. Fleig told the teller he wanted to add Mrs. Fleig to his checking account. Both Fleigs signed a new signature card for the account.
The signature card contained two boxes, one providing for joint ownership with rights of survivorship and one providing for joint ownership without rights of survivorship. Both boxes were left blank.
The signature card also stated:
"We agree that the changes on this card amend the previously signed account card and are subject to the terms and conditions of the membership and account agreement, and to any amendment the credit union makes from time to time".
The membership and account agreement provided that: "Unless otherwise stated on the account card, a joint account includes rights of survivorship".
This means that when one owner dies, all sums in the account will pass to the surviving owner.
What Happened After One of the People on the Account Died.
Mr. Fleig died in July of 2015 leaving behind Mrs. Fleig, two sons from a previous marriage, and a considerable amount of money in the checking account.
Who Challenged Ownership of the Account and Why Was it Challenged?
Mr. Fleig's sons, the co-personal representatives of his estate, filed a lawsuit against Mrs. Fleig and the credit union on behalf of the estate regarding the ownership of the account. The sons argued that the estate owned the credit union checking account.
What the Wyoming Supreme Court said about Account Ownership.
An account signature card is a type of contract, and therefore, must be read, considered and construed in its entirety in keeping with the general principles of contract interpretation. In determining such rights, the intention of the parties is controlling. Our primary focus in construing or interpreting a contract is to determine the parties' intent, and our initial inquiry centers on whether the language of the contract is clear and unambiguous.
These principles apply to bank signature cards as well. Documents incorporated by reference in a bank account signature card are part of the contract.
We begin and end our examination with the plain language of the contract. The contract between Mr. and Mrs. Fleig and the credit union consisted of the signature card and the documents incorporated by reference, including the Membership and Account Agreement. While the signature card provides no indication whether the account provides rights of survivorship, the Membership and Account Agreement states: Unless otherwise stated on the account card, a joint account includes rights of survivorship. This means when one owner dies, all sums in the account will pass to the surviving owner.
In the End, Who Owns the Account?
Reading the contract as a whole, we conclude that the contract terms are clear and unambiguous: the account includes rights of survivorship. The failure to check the box regarding the right of survivorship did not create an obscure or double meaning making the contract ambiguous where the Membership and Account Agreement provided for rights of survivorship when not otherwise stated on the signature card. Because there is no ambiguity, we will not look to extrinsic evidence to interpret the parties' intent. Mrs. Fleig has a right of survivorship in the checking account.
Wait, What are the Rules in Wyoming?
The two sons argued that because the face of the signature card said nothing, it is the only document that could create a right of survivorship and because it said nothing, we must presume no right existed.
However, a joint tenancy with right of survivorship may be created in personal property, and specifically in a bank account. To create such an interest in Wyoming, one of the following requirements must be met:
1. Each of the four unities of interest, time, title and possession must be present, with the added unity of person for a tenancy by the entirety, or
2. In the absence of one or more of the first four unities, it must be evident from the language of the instrument itself that the parties thereto intended to create a right of survivorship.
In Wyoming, without the express provision for a joint tenancy, a tenancy in common is presumed. For example, an account created this way: "To Phil Oatts or Marilyn Oatts or Vicki Jorgenson" fails to make an intention to create a joint tenancy with right of survivorship, and this example creates tenants in common.
We do not look only to the face of the signature card to determine whether the parties intended to create rights of survivorship. In our case, the language contained in the Membership and Account Agreement formed part of the contract between Mr. and Mrs. Fleig and the credit union.
The signature card incorporated the Membership and Account Agreement by reference; accordingly, both documents formed the contract between Mr. and Mrs. Fleig and the Credit Union and unambiguously expressed the intent that joint accounts have rights of survivorship. Mrs. Fleig has a right of survivorship in the checking account.
If you are making your estate plan, it is important to consult with an estate planning law professional to make sure a proper plan is in place that covers your financial needs. I can help you coordinate your will or trust with your accounts and any other asset protection documents.
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