Beehive State Bank v. Rosquist, 11951

• Decision Date: 14 April 1971
• Docket Number: No. 11951,11951
• Parties: d 62 BEEHIVE STATE BANK, a corporation, Plaintiff and Respondent, v. Deon ROSQUIST et al., Defendants, First Security Bank of Utah, N.A., a corporation, Garnishee, Fred L. Painter, Intervener and Appellant.
• Court: Utah Supreme Court

Page 1188

484 P.2d 1188

26 Utah 2d 62

BEEHIVE STATE BANK, a corporation, Plaintiff and Respondent, v. Deon ROSQUIST et al., Defendants First Security Bank of Utah, N.A., a corporation, Garnishee Fred L. Painter, Intervener and Appellant.

No. 11951.

Supreme Court of Utah.

April 14, 1971.

Will L. Hoyt, Nephi, for intervener and appellant.

Robert M. Anderson, Roger H. Thompson, of Van Cott, Bagley, Cornwall & McCarthy, Salt Lake City, for plaintiff-respondent.

L. Ridd Larson, of Ray, Quinney & Nebeker, Salt Lake City, for garnishee.

TUCKETT, Justice.

This is the second appeal in this case. The first appeal in this matter was by the plaintiff from a summary judgment entered by the court below in favor of the intervener. After remand and a trial in the court below, judgment was entered in favor of the plaintiff and against the intervener, and the intervener now appeals to this court.

The plaintiff, Beehive State Bank, was a judgment creditor of Ila R. Rainter and during her lifetime caused a writ of garnishment to issue, attaching a joint checking account standing in the name of Ila R. Painter and Fred L. Painter, her husband. During the pendency of these proceedings Ila R. Painter died. The contract entered into by the defendant Ila R. Painter and her husband, Fred L. Painter, intervener at the time the joint account was established contained the following provisions:

The joint depositors whose names are signed on the reverse side of this card hereby agree with each other and with the above bank that all sums now on deposit, heretofore or hereafter deposited by any one or more of said joint depositors with said bank to their credit as joint depositors, with all accumulations thereon, are and shall be owned by them jointly with the right of survivorship, and be subject to the check if the account is a checking account or receipt if the account is a savings account of any one or more of them or of the survivors or survivor of them, and the payment to or on the check or receipt of any one or more of them or the survivors shall be valid and discharge said bank from liability.

On the first appeal the court was of the opinion that the matter could not be decided by a summary judgment based upon the affidavit of the intervener alone. The case was remanded to the trial court for the purpose of determining the interest of Ila R. Painter in and to the fund while she was alive, if any she had, which should be applied toward satisfaction of the plaintiff's judgment. ¹ A trial was had in the court below during the course of which the bank's signature card with the agreement thereon above referred to was introduced in evidence, as well as the deposit slip showing two deposits to the account which were the only ones made.

It may well be that the trial court misinterpreted our decision when this case was first remanded for trial. In that decision we said if the contract between the parties ostensibly creates joint tenancy relationship with full right of survivorship, there arises a presumption that such is the case unless and until some interested party shows under equitable rules that the contract should be reformed to show some other agreement of the parties or that the contract is not enforceable because of fraud, mistake, incapacity, or other infirmity. ²

This matter is remanded for a further hearing as to the ownership, if any, of Ila R. Painter in the account either by gift or the deposit of her separate funds, and also on the issue of the unenforceability of the deposit contract. ³ The parties should have the opportunity of producing any further evidence they may have. No costs awarded.

CROCKETT, J., concurs.

CALLISTER, Chief Justice (concurring).

I concur but wish to direct attention to the recent decision of this court in Hobbs v. Fenton, 25 Utah 2d 206, 479 P.2d 472 (1971).

HENRIOD, Justice (dissenting in part and concurring in part).

The observations of this author well might be labeled an Anatomy of Near Murder of a Utah Joint Account. It all started after Holt v. Bayles, ¹ which involved a joint bank account created about 36 years ago by Anna and Emma Bayles. About $13,000 of Anna's money was deposited in a local bank under a written agreement ² to the effect that it was owned jointly with right of survivorship, and with right to withdrawal by either. Anna died and Emma, as survivor, withdrew the money. She admitted she contributed nothing to the fund. When asked 'When were you to have the money?' she frankly answered 'When aunt Anna died.' In an action by nieces against Anna's executrix, to have the money declared that of the estate, a nonsuit was entered and we affirmed, saying the decision 'was controlled largely by the agreement of joint tenancy executed by Anna and Emma Bayles.' The plaintiffs had not alleged any fraud, overreaching, mistake, incompetency or failure of the agreement to express the true intent of the parties, or that it was ambiguous or uncertain,--the whole argument being that Anna owned all the money and 'that the deposit card agreement does not make a binding contract of survivorship or create a joint tenancy.' The trial court rejected such argument. We unanimously agreed, saying that under the above circumstances 'the question of intention ceases to be an issue and the courts are bound by the agreement.'

The law of Holt v. Bayles ³ was eminently clear and for years became the guideline for all attorneys, who advised their clients that they might eliminate expenses and lengthy probate proceedings by creating joint bank accounts with a right of survivorship.

Almost exactly seven years later, this court whose membership included only one that had sat in Holt v. Bayles, decided Neill v. Royce, ⁴ which was the very first case involving a joint bank account since Holt v. Bayles, and in doing so, initiated the dissection of the latter's decision. Florence, the plaintiff, had been married to Royce and bore him several children. They were divorced, and Royce married another woman named Ida, who had several children by a previous marriage. Ida had a sum of money which she put in a joint account with Royce, ostensibly to save her own children from the expense of probate if she died. Royce said he would not claim any of the money. Royce became delinquent in support payments for his children by Florence, who attached the joint account out of which the trial court gave her an award, after Ida claimed sole ownership of the account. The trial court relied on the contract and its terms and decided the case on the precedent of Holt v. Bayles. This court on appeal, actually affirmed the trial court, but in doing so based its affirmance on considerable double-talk about a presumption of ownership. This was a theory urged by no one save this court's judicial altruism. The court held that the clear unambiguous terms of the agreement were subject to two presumptions,--that ownership is presumed to be in joint tenancy if both of the depositors are alive,--which can be overcome by clear and convicing evidence,--but if one of them has died, the presumption of total ownership is conclusive in the survivor. No reason was stated for the difference, which provokes antithetical results arising from identical language found in a clear, unambiguous instrument where the intentions are clearly expressed. No reason is given why a joint tenancy presumption should exist five minutes before a death, which can be defeated by clear and convincing evidence (whatever that means in interpreting an instrument incapable of having more than one clearly expressed meaning), while a conclusive presumption should exist five minutes after the death, which then becomes impervious to attack by clear and convincing evidence or any other kind of evidence, save, perhaps, that of fraud, overreaching, etc. mentioned in Holt v. Bayles,--none of which was urged by anyone in the Neill case. Thus it would appear that Neill v. Royce is an illegitimate offspring of legal reasoning, contractual construction, pleading and theories urged. At this juncture it is obvious that the court affirmed half of Holt v. Bayles and overruled half. At this juncture it also obviously departed from the elementary principle that when parties reduce to writing their intentions, absent any equitable basis for reforming clear, understandable language, they, and particularly strangers to the instrument, are bound by its terms, not vulnerable to any kind of attack by parol. Why this court in Neill v. Royce opined that the principle enunciated in Holt v. Bayles applied only in survivorship cases is as mysterious as Marley's ghost, since it was unequivocally stated in Holt v. Bayles, without any hint of the distinction made in Neill v. Royce, that 'Where there is a joint agreement executed by the parties which clearly declares the intention to create a joint interest of each in the deposit, or credit, the court will sustain such intention thus expressed, especially where the contract is not attacked for fraud, mistake, incapacity, or other infirmity,' and that 'Where such intention is clearly expressed in a written contract executed by the parties, which remained unaltered, and there is no fraud, undue influence, mistake, or other infirmity alleged, the question of intention ceases to be an issue and the courts are bound by the agreement.'

Without any apparent or expressed good reason, Neill v. Royce cut the juris out from under the corpus of Holt v. Bayles--and became the Utah law in the Utah joint account area.

Eight years after Neill v. Royce, in Greener v. Greener, ⁵ with no intervening Utah joint account cases having been decided, we arrived at an opposite conclusion, based, however, on the reasoning in Neill v. Royce, where we said that the joint account was immune from attack on the ground that either one or the other of the joint depositors owned all or part of it, because there was no clear and convincing evidence of intention to sever the...