Estate of Bodman v. Bodman, 92-CA-01005-SCT

• Decision Date: 25 April 1996
• Docket Number: No. 92-CA-01005-SCT,92-CA-01005-SCT
• Parties: In the Matter of the ESTATE OF James F. BODMAN, Deceased: Sally B. Herrington v. James F. BODMAN, Jr.
• Court: Mississippi Supreme Court

Page 1245

674 So.2d 1245

In the Matter of the ESTATE OF James F. BODMAN, Deceased:

Sally B. Herrington v. James F. BODMAN, Jr.

No. 92-CA-01005-SCT.

Supreme Court of Mississippi.

April 25, 1996.

Rehearing Denied June 13, 1996.

M. McIntosh Forsyth, Richton, for Appellant.

Robert T. Jackson, Jackson & Woodruff, Hattiesburg, for Appellee.

Before DAN M. LEE, C.J., and BANKS and JAMES L. ROBERTS, Jr., JJ.

BANKS, Justice, for the Court:

Here we are asked to consider whether a conservator violated her fiduciary duty by sharing a joint tenancy with a right of survivorship with her ward. We conclude that, while there is no per se violation, she did violate her fiduciary duty to the estate in the instant case by depleting the funds from three of the four accounts within the estate for the care of the ward without seeking court permission, while maintaining the funds held within the joint account that she shared with the ward.

I.

On July 3, 1978, James F. Bodman, Sr. created a joint tenancy with rights of survivorship between himself and his daughter, Sally B. Herrington through the establishment of a joint certificate of deposit account at First Magnolia Federal Savings and Loan Association. This account was later renewed on April 3, 1981. By 1987, the decedent, James F. Bodman, Sr. had become ill and a conservatorship was established September 25, 1987, with his daughter, Sally B. Herrington serving as conservator of his estate.

An inventory calculated the value of the money estate to be $56,500 consisting of four certificates of deposit with the Magnolia Federal Savings Bank. One of these certificates was the joint certificate of deposit account shared by the conservator, Herrington and the decedent in the amount of $42,500. The other three accounts were payable on death to James F. Bodman, Jr., or his children, Paige Bodman and Bhrett Bodman, but were later transferred by the ward and the conservator and made payable on death to the account of the conservator Sally B. Herrington. These accounts were eventually closed and used by Herrington to pay for the expenses of the ward's estate. However, Herrington, as conservator of the estate spent very little from the account she shared with her ward. Rather, the account was allowed to increase in value to the amount of $48,762.33, which Herrington withdrew and transferred to her own account after the fourth and final accounting to the court.

The decedent wrote a will on November 18, 1987, which bequeathed the funds in his joint checking accounts and certificates of deposit to all of his children to be shared equally. The will also stated that the accounts with rights of survivorship were established for purposes of convenience only and not for the purpose of establishing an ownership interest in the funds by way of survivorship. It provided that the decedent wanted his children to share the responsibility for the administration of his estate and appointed each of them coexecutors of his will.

James F. Bodman, Sr. died on February 23, 1991, and Herrington petitioned to have his will probated in May of 1991. By the time the will had been probated, however, Herrington, as conservator of the Bodman estate, had already presented her fourth and final accounting in the conservatorship to the chancellor on March 11, 1991.

An order for probate was entered by Chancellor Patterson on May 6, 1991, appointing Herrington as executor. Upon motion of James F. Bodman, Jr., a further order was entered by Chancellor Robert Taylor on June 21, 1991, appointing James F. Bodman, Jr. co-executor of the Bodman estate in accordance with the will of the decedent. Thereafter, James F. Bodman, Jr. petitioned the Chancery Court to have Herrington removed as co-executor alleging that she maintained a conflict of interest while acting as both fiduciary of the estate and co-owner of a joint account with her ward. He further requested that she account for and present to the estate all funds withdrawn from the estate.

The court responded to this petition by removing both Herrington and James F. Bodman, Jr. as co-executor and appointed F. Marvin Morris, III, the County Probate Administrator, as Administrator of the estate. In its memorandum opinion, the court declared null and void the fourth and final accounting of the conservatorship, the closing of the conservatorship, the discharge of Herrington as the conservator of the estate, and the adjudication of ownership in Herrington of the joint certificate of deposit. The court then distinguished the instant case from this Court's previous decisions involving joint tenancies such as Strange v. Strange, 548 So.2d 1323 (Miss.1989), by stating that it had not been able to find a case decided by this Court "where the joint tenant ... occupied a fiduciary relationship by law ... with her joint tenant" James F. Bodman, Sr.

Basing its decision on Dowdy v. Jordan, 128 Ga.App. 200, 196 S.E.2d 160 (Ga.App.1973), the court held that Herrington had violated her fiduciary duty and determined that the joint certificate account shared between the ward and her should be made a part of the property of the ward in its entirety and dealt with as part of the estate. The court also directed her to restore to the estate the $48,762.33 withdrawn by her as conservator under the order of March 11, 1991, together with interest thereon at the rate which would have accrued from the date of withdrawal to the date of restoration. From this judgment, the appellant appeals to this Court asserting the following issues:

A) WHETHER THE JOINT TENANCY SHARED BETWEEN HERRINGTON AND THE DECEDENT WAS SEVERED BY THE DECEDENT'S WILL; AND

B) WHETHER HERRINGTON VIOLATED HER FIDUCIARY DUTY AS CONSERVATOR BY SHARING A JOINT TENANCY WITH THE RIGHTS OF SURVIVORSHIP WITH HER WARD.

II.

a.

Herrington asserts that the trial court committed error in holding that the joint tenancy shared between Herrington and her late father, James F. Bodman, Sr. was severed by her father's last will and testament. Herrington relies on the cases of Bishop v. U.S., 338 F.Supp. 1336, 1343 (N.D.Miss.1970), reh. denied, 471 F.2d 649 (5th Cir.1972), cert. denied, 409 U.S. 878, 93 S.Ct. 131, 34 L.Ed.2d 132 (1972); Strange v. Strange, 548 So.2d at 1328, and Stamper v. Edwards, 607 So.2d 1141 (Miss.1992), which all stand for the proposition that a joint tenancy with rights of survivorship cannot be severed by a contrary disposition in a will.

Whether a joint tenancy can be severed by a will and whether the appellant violated her fiduciary duty as a conservator are questions of law, which command a relatively broad standard of review by this Court. It is a well-settled principle that the Supreme Court is the "ultimate expositor of the law of this state." UHS-Qualicare, Inc. v. Gulf Coast Community Hospital, Inc. 525 So.2d 746, 754 (Miss.1987). Therefore, this Court conducts a de novo review on questions of law. Id.; C.E. Tucker v. Hinds County, Mississippi, and Mississippi Power & Light Company, 558 So.2d 869, 872 (Miss.1990).

Bodman contends that decedent's will, which divides the account between both of his children, should control the disposition of the account. He bases this contention on the notion that the intent of the testator must be carried out where that intent is known. The cases which are cited by the appellee as authority for this contention, however, can all be distinguished from the instant case in that none of them involve a dispute as to whether a joint tenancy should be severed by a contrary disposition of property in a subsequent will.

It is a well-settled proposition that a "subsequent will does not destroy [a] joint tenancy and does not terminate that tenancy and divest the corpus of it into the estate of the testator." Strange at 1328. This Court in Strange stated that "chaos would result in banking, commerce and financing ..." if wills made subsequent to the creation of a right to survivorship were allowed to sever joint tenancies. Id. at 1326. There is no dispute in the present case as to the creation of the joint tenancy with rights of survivorship through the establishment of a joint account at First Magnolia Federal Savings and Loan Association on July 3, 1978, and its renewal on April 3, 1981. Furthermore, there is no evidence that James F. Bodman, Sr. was incompetent or unduly influenced to establish this account. Following this Court's previous holdings, Herrington's right to survivorship is unaffected by the decedent's will.

Bodman also argues that the joint tenancy should be severed because it was established only for the ward's convenience. The making of a subsequent will by the decedent was offered as evidence that the joint tenancy was not created with the "clear intention" to create a right of survivorship. This argument fails also because a court may not consider such parol or extrinsic evidence to give the joint tenancy a meaning other than that apparent from its language. Cooper v. Crabb, 587 So.2d 236, 242 (Miss.1991) (where this Court held that a chancery court erred in relying on parol or extrinsic evidence in determining that documents creating a joint tenancy in certificates of deposit were created solely for the decedent's convenience and did not control over the provisions of a will). Thus, Herrington's claim to the account survives Bodman's assertion that the decedent's will severs the joint tenancy with its rights to survivorship.

b.

If the validity of the joint tenancy was the sole issue before this Court, Herrington's claim would prevail. However, the lower court was correct in finding that Herrington's position as the conservator of her joint tenant's estate differentiates the instant case from other cases cited by the appellant which state that the joint tenancy cannot be severed by a subsequent will. In reaching this conclusion, the lower court stated that it "kn[ew] of no pronouncement of law in this State determinative of the precise factual circumstance...