Estate of Steed, Matter of, 18486

• Decision Date: 23 May 1994
• Docket Number: No. 18486,18486
• Citation: 521 N.W.2d 675
• Parties: In the Matter of the ESTATE OF Mae T. STEED, Deceased. . Considered on Briefs
• Court: South Dakota Supreme Court

Page 675

521 N.W.2d 675

In the Matter of the ESTATE OF Mae T. STEED, Deceased.

No. 18486.

Supreme Court of South Dakota.

Considered on Briefs May 23, 1994.

Decided Sept. 14, 1994.

Richard R. Rahn, Sioux Falls, for appellants Margie A. Houston and Pearl Peterson.

Merle A. Johnson of Woods, Fuller, Shultz & Smith, P.C., Sioux Falls, for appellee Katherine E. Peterson.

DOBBERPUHL, Circuit Judge.

PROCEDURAL HISTORY

Margie A. Houston (Margie) and Pearl Peterson (Pearl), sisters of decedent, Mae T. Steed (decedent), filed a petition seeking a determination that the decedent, by the terms of paragraph 6 of her will had revoked all joint tenancies of personal property. Margie and Pearl further sought an order placing the joint tenancy property in the residue of decedent's estate.

Katherine E. Peterson (Katherine), also a sister of decedent, filed a response to this petition in which she sought to have the joint accounts distributed to the surviving joint payees.

Judgment was entered holding that decedent had failed to properly revoke any joint accounts by the provisions of her will as required under SDCL 30-23-46. The circuit court held that the terms of SDCL 30-23-46(5) require that each joint account, to be changed or modified by will, must be individually identified in the will. Because decedent failed to individually identify each joint account which she may have intended to change or modify in paragraph 6 of her Last Will and Testament, all joint accounts were to be paid to the surviving joint payees as designated on each joint account. Margie and Pearl appeal. We affirm.

FACTS

On March 28, 1990, decedent executed a Last Will and Testament in the state of South Dakota which purported to revoke all former wills and testamentary papers. Paragraph 6 of the will states, "I hereby intentionally revoke any joint tenancies or trust arrangements commonly called 'Totten Trusts' by this will." Margie and Pearl argue that through this clause decedent intended to revoke any joint bank accounts and certificates of deposit with rights of survivorship, and include them in the residue of her estate. Katherine argues that decedent intended these accounts to be distributed to the surviving joint payees as designated on each account.

Decedent came from a large family of nine girls and two boys. At the time of her death on August 11, 1992, decedent was survived by four sisters, Margie, Pearl, Katherine and Erma Stevens, who is since deceased. Margie resided in Pequot Lakes, Minnesota, as did Pearl. Pearl however, had only lived in Pequot Lakes for four years at the time of decedent's death. Prior to that, she had lived in Compton, California for thirty years. Prior to her own death, Erma Stevens had resided in Long Beach, California since 1965. Katherine was residing in Fridley, Minnesota, at the time of decedent's passing.

Decedent was an elderly lady at the time of her death. She had been a widow for many years, had several sources of income and was able to live quite comfortably from day to day. Her home was paid for and she had no children. Further, she was quite thrifty and was able to place a considerable amount of her income in various savings vehicles.

There were a number of joint accounts in existence at the time of decedent's death. Some of these joint accounts were created prior to execution of her will while others were created subsequent to execution of the will. A number of the joint accounts were U.S. Savings Bonds. Pursuant to federal regulation, designations of joint payees on U.S. Savings Bonds cannot be changed by will. This fact was conceded by counsel for Margie and Pearl and acknowledged by the circuit court.

Among the joint payees of the various U.S. Savings Bonds were Pearl and Katherine. Margie was not among those listed as a joint payee on any of the U.S. Savings Bonds. This is also true of the joint accounts which Margie and Pearl are now seeking to have included in the residue of the estate. Both Pearl and Katherine were listed as joint payees while Margie was absent from the list of joint account owners. Katherine was, however, named as a joint payee on joint accounts totalling considerably more than those joint accounts with other joint payees.

Additionally, by the terms of her will, decedent left all of her "personal effects, household goods, tools, yard equipment and car, in equal shares" to Pearl and Katherine. Again, Margie was omitted. The residue of her estate was left in equal shares to all four of her then surviving sisters.

Katherine testified that she and decedent were very close. While Katherine was attending school in Pipestone, Minnesota, decedent would frequently visit her and take her to stay in Thomas, South Dakota, where she was living at the time. Even though Katherine resided in Fridley, Minnesota at the time of decedent's death, they remained quite close, writing to each other on a weekly basis and talking on the phone at least once a month.

At trial, Katherine testified that although decedent would from time to time discuss various financial matters with her, she was basically unaware of decedent's financial situation. Katherine further testified that if decedent would have needed assistance in paying her bills or help in meeting her financial obligations at any time prior to her death, she certainly would have helped her in that capacity.

DECISION

ISSUE ONE

DID THE TRIAL COURT ERR IN FINDING THAT DECEDENT CREATED THE JOINT ACCOUNTS FOR THE

BENEFIT OF THE NONDEPOSITING JOINT PAYEES, RATHER THAN FOR HER OWN CONVENIENCE?

An account opened in joint names raises a rebuttable presumption that the creator of such an account intended the usual rights of survivorship to attach to it. Matter of Estate of Kuhn, 470 N.W.2d 248, 250 (S.D.1991); Matter of Estate of Krause, 444 N.W.2d 4, 9 (S.D.1989); Roth v. Pier, 309 N.W.2d 815, 816 (S.D.1981); Kirsch v. First Nat'l Bank of Watertown, 298 N.W.2d 71, 72 (S.D.1980); Miles v. Hanten, 164 N.W.2d 601, 602 (S.D.1969); Wagner v. Wagner, 83 S.D. 565, 163 N.W.2d 339, 342 (1968) (quoting Estate of Pfeifer, 1 Wis.2d 609, 85 N.W.2d 370, 372 (1957)). "The principle is the same whether the asset is a bank account or a C.D." Estate of Kuhn, supra. In order to rebut the presumption that an asset held in joint tenancy passes to the surviving joint payee upon the death of the first, the party seeking to negate the presumption must show with clear and convincing evidence that the original depositor or purchaser did not intend the usual rights of survivorship to attach to the joint asset, but instead intended the arrangement for her own convenience. Estate of Kuhn, supra; Kirsch, supra; Wagner, supra.

Our well established line of caselaw has been codified at SDCL 30-23-46(1), which attaches a presumptive right of survivorship to all joint accounts by stating in pertinent part:

Sums remaining on deposit at the death of a party to a joint account belong to the surviving party or parties as against the estate of the decedent unless there is clear and convincing evidence of a different intention at the time the account is created.

(emphasis added). The controlling consideration is the intention of the original depositor at the time the accounts were created. Whether the joint accounts in question were created by decedent for her own convenience or for the benefit of the nondepositing joint payees is a question of fact to be determined from all the facts and circumstances in the case. Wagner, supra, 83 S.D. at 571, 163 N.W.2d at 342. We review the trial court's determination of the original depositor's intention under the "clearly erroneous" standard. Estate of Kuhn, supra, at 251. "The question is not whether this Court would have made the same findings that the trial court did, but whether, on the entire evidence, we are left with a definite and firm conviction that a mistake has been committed." Id. (quoting Kirsch, 298 N.W.2d at 73 (citing In re Estate of Hobelsberger, 85 S.D. 282, 181 N.W.2d 455, 459 (1970))).

The trial court found that there was no clear and convincing evidence that decedent created the joint accounts in question for anything other than the benefit of the surviving joint payees. ¹ The evidence in the record clearly supports this finding.

In their brief, Margie and Pearl argue that there is "strong evidence that Mae T. Steed created the subject joint bank accounts solely for her own convenience." However, they attempt to support this argument by relying mainly on a page of five hypothetical questions in which their counsel attempted to lead Katherine into admitting that the accounts were created for decedent's convenience. ² We find this argument to be without merit. A careful reading of the testimony in question shows simply that Katherine was a loving and caring sister and that she "certainly would have " helped decedent with her financial matters if such help would have been needed. There is no evidence that decedent ever needed this assistance, or that Katherine ever helped her pay her bills or meet her financial obligations in any way. The evidence tends to show that Katherine was unaware that she was named as a joint payee on the joint accounts at issue. Instead, the facts establish that decedent was very conservative with her money. She was able to live comfortably as a result of her various sources of income and was able to acquire a considerable amount of assets which she used to purchase various investments, including the joint accounts in question.

Although the evidence shows that decedent was an elderly woman, there was no showing that she suffered from serious health problems which may have forced her to seek help with her financial matters. Just one year prior to her death she was able to travel by automobile from Sioux Falls to Pequot Lakes, Minnesota to visit her sisters. This would not evidence someone who was "ailing" as claimed by Margie and Pearl.

Finally, and most importantly, the facts show...