Guardianship of Medley, In re
| Decision Date | 12 December 1990 |
| Docket Number | No. 89-03080,89-03080 |
| Citation | 573 So.2d 892 |
| Parties | 15 Fla. L. Weekly D3008 In re the GUARDIANSHIP OF Catherine S. MEDLEY, Incompetent. Patricia J. EMIDDIO, Individually, and as Personal Representative of the Estate of Catherine S. Medley, Deceased; Pamela Nadeau, f/k/a Pamela Donoher and Cynthia McLaren, Appellants, v. SOUTHEAST BANK, N.A., Individually and as Guardian of the Property of Catherine S. Medley, Incompetent, Appellee. |
| Court | Florida District Court of Appeals |
Wm. Fletcher Belcher and Angela M. Adams of Law Offices of Wm. Fletcher Belcher, St. Petersburg, For appellants.
William F. Blews of William F. Blews, P.A., St. Petersburg, and Johnson S. Savary of Dykema Gossett, Sarasota, for appellee.
At the heart of this case, which involves twelve joint savings and loan association accounts totaling $260,690.86 with signature cards authorizing withdrawals by either of the two joint owners, is whether one owner may withdraw all the funds and properly appropriate them to his own use without the consent of the other. The order from which this appeal is taken answers, in effect, yes. We reverse.
This is an appeal from an order of the trial court dismissing with prejudice petitioners' fourth amended petition to surcharge appellee Southeast Bank N.A., guardian of the property of Katherine S. Medley, incompetent, who is now deceased. Petitioner Patricia Emiddio, daughter of Mrs. Medley, filed the petition and this appeal as the personal representative of Mrs. Medley's estate. She and the other petitioners, Pamela Nadeau and Cynthia McLaren, who are granddaughters of Mrs. Medley, also filed the petition and this appeal individually as beneficiaries of eight Totten trusts 1 which had allegedly been established in savings and loan association accounts in the names of Mrs. Medley and Mr. Medley (Ewen E. Medley) as co-trustees. Six of those accounts with balances totaling $144,403.42 are alleged to have been created for the benefit of Patricia Emiddio and one each with balances of $10,006.03 and $10,000.00, respectively, are alleged to have been created for the benefit of Pamela Nadeau and Cynthia McLaren. Petitioners seek to surcharge appellee for damages to Mrs. Medley's guardianship and probate estates and to petitioners individually as a result of appellee's alleged breach of its duties as guardian.
The breach is alleged to have occurred from the appellee's failure to safeguard the interests of Mrs. Medley in twelve savings and loan association accounts which were maintained in the names of Mr. and Mrs. Medley, including the eight Totten trust accounts referred to above, when Mr. Medley, who subsequently predeceased Mrs. Medley, withdrew all the funds from the accounts and appropriated them to his own use with the knowledge and participation of appellee in the manner described below. Those withdrawals are alleged to have been pursuant to provisions in the account signature cards authorizing either Mr. or Mrs. Medley to make withdrawals. It is alleged that three of the accounts with balances totaling $72,183.15 were joint tenancies with right of survivorship, one with a balance of $24,098.26 was a tenancy by the entireties, and the foregoing eight Totten trust accounts totaling $164,409.45 were tenancies by the entireties subject to Totten trusts. The petition does not allege the original source or sources of the funds in the accounts, i.e., whether they came from Mr. or Mrs. Medley's individual funds or from their joint funds or a combination.
More specifically, the petition alleges that Mrs. Medley was mentally incompetent from June 15, 1983 until her death on June 24, 1985 and that she was formally adjudicated incompetent in December, 1983 at which time appellee was appointed guardian of her property. It is alleged that between July, 1983 and December, 1983, Mr. Medley withdrew the funds totaling $101,728.01 from six of the accounts. It is further alleged that in January, 1984, Mr. Medley withdrew the funds totaling $158,962.85 from the remaining six accounts and that he placed the funds from all the accounts in a trust for himself during his lifetime with the remainder after his death to go to his half-sister and his housekeeper.
In alleging wrongdoing on the part of appellee the petition alleges that appellee knew or should have known of Mr. Medley's withdrawals from the accounts and that his testamentary plan was different from that of Mrs. Medley whose beneficiaries were the individual petitioners; that appellee's failure to safeguard Mrs. Medley's ownership interests in the account funds (which, according to the petition, appellee knew was important and planned to do through steps including a petition to partition those funds but did not do) was a breach of its duty as guardian of her property; and that appellee, who was also trustee of Mr. Medley's trust, took possession of and improperly distributed the funds upon Mrs. Medley's death (after she is alleged to have become entitled to the funds by having survived Mr. Medley) to Mr. Medley's half-sister and housekeeper.
The trial court ruled that the petition failed to state a cause of action. The apparent reasoning was that because the signature cards authorized either Mr. or Mrs. Medley to withdraw funds from the accounts, Mrs. Medley had no ownership interests therein which were traceable to the funds withdrawn by Mr. Medley and therefore appellee breached no duty in failing to safeguard her interests. Stated in another way, the trial court ruled that since Mr. Medley had, in the trial court's words, "absolute authority" under the signature cards to withdraw the funds from the accounts, the withdrawals were not shown to have been wrongful, therefore the petition could not state a cause of action against the guardian. The trial court apparently concluded that Mr. Medley's right to withdraw the funds from the accounts gave him the right to appropriate the funds to his own use without any accountability to his wife. For present purposes the essence of the trial court's ruling appears to have been the conclusion that the husband's withdrawals of the funds terminated any interests of his wife therein. The trial court also ruled that the individual petitioners, as beneficiaries of the Totten trusts, did not have standing to bring the petition against the guardian.
In reversing we hold that the existence of the provisions in the signature cards authorizing the withdrawals by Mr. Medley did not preclude ownership interests of Mrs. Medley in the funds withdrawn from the accounts and therefore did not preclude a cause of action under the alleged circumstances of this case against her guardian for a breach of duty to safeguard those interests, as we will explain. We also hold that under the allegations the Totten trust beneficiaries, as holders of vested interests in the withdrawn funds, would not lack standing to bring the petition, as we will also explain.
The remainder of this opinion will (A) explain the legal principles requiring a reversal and (B) conclude by summarizing our view of the underlying import of case law in this area, which has been described as a morass. Section (A) explains not only why we disagree with the trial court that the signature card provisions authorizing withdrawals by either spouse precluded Mrs. Medley from having any continuing ownership interests in the funds withdrawn by Mr. Medley but also why we have concluded that Mrs. Medley could be shown to have had such continuing ownership interests and why appellee could be shown to have had and breached a duty to safeguard those interests. In its explanation of those reasons section (A) will be divided into three subsections.
Subsection (A)(1) will deal with the funds withdrawn by Mr. Medley and appropriated to his own use from the one account alleged to have been held by Mr. and Mrs. Medley as a tenancy by the entireties and the three accounts alleged to have been held by them as joint tenants with right of survivorship and will explain that Mrs. Medley can be shown to have had continuing ownership interests in those funds. (No question has been raised, nor does any appear to exist, that Patricia Emiddio, as Mrs. Medley's personal representative, has standing to sue concerning alleged ownership interests of Mrs. Medley in those four accounts.) Our reasoning in subsection (A)(1) will necessarily be in considerable depth to explain governing principles not always clearly brought out in the case law. Those principles include concepts having as their foundations venerable incidents of property ownership which in our view were disregarded in the district court of appeal case which supports the trial court's ruling and which, for reasons we will explain, we conclude mistakenly failed to follow controlling precedent.
Subsection (A)(2) will deal with the funds withdrawn by Mr. Medley and appropriated to his own use from the eight accounts alleged to have been held by Mr. and Mrs. Medley as tenancies by the entireties subject to Totten trusts and will explain that Mrs. Medley can be shown to have had continuing ownership interests in those funds. Subsection (A)(2) will also explain that the individual petitioners could be shown to have vested interests in those ownership interests and standing to sue for damages thereto.
Subsection (A)(3) will describe in general terms the nature of the guardian's duty under the allegations, the breach of which would expose the guardian to a surcharge, if ownership interests of the types referred to in subsections (A)(1) and (A)(2) are shown to have existed.
(1) An Interest of One Account Owner in a Joint Account Will Continue in the Funds When All the Funds Are Withdrawn by the Other Owner and Appropriated to the Other Owner's Own Use Without the Agreement of Both Owners if the Account Is Owned as a Tenancy by the Entireties or a...
To continue reading
Request your trial
-
Beal Bank, SSB v. Almand and Associates
... ... We thus disapprove of the statement in Medley, 573 So.2d at 900, that because a signature card executed between a depositor and a bank is exclusively for the "protection" of the financial ... Thus, we agree with the opinion of Judge Gross in Sitomer that In re Guardianship of Medley, 573 So.2d 892, 897-99 (Fla. 2d DCA 1990), improperly "equated a joint tenancy with right of survivorship with a tenancy by the ... ...
-
Regions Bank v. Hyman
...issue did not disclaim the tenancy by the entireties or indicate another form of ownership, and disapproved In re Guardianship of Medley, 573 So.2d 892 (Fla. 2d DCA 1990) (signature card is for protection of bank and the convenience of the parties involved; does not affect ownership status ......
- Lindsey v. Bill Arflin Bonding Agency Inc., 93-978
-
Beal Bank, SSB v. Almand & Associates
... ... 8 The title on the card is "Amos F. Almand, Jr. or Doris J. Almand, JT TEN." ... 9 But see In re Guardianship of Medley, 573 So.2d 892 (Fla. 2d DCA 1990) ... 10 Losey v. Losey, 221 So.2d 417 (Fla.1969); Hargett v. Hargett, 156 Fla. 730, 24 So.2d 305 ... ...
-
Marital bank accounts as entireties property: what is the current state of Florida law?
...not claiming an interest as a third party beneficiary of the deposit agreements involved.[33] He also cited In re Guardianship of Medley, 573 So. 2d 892, 900 (Fla. 2d DCA 1990), for the proposition that a signature card executed between a depositor and a bank is exclusively for the "protect......
-
Joint ownership of bank accounts in Florida by husband and wife: when does a spouse's interest in account funds survive their withdrawal by the other spouse?
...the bank and the account owners is conclusive of the ownership rights as between the account owners. In re Guardianship of Medley, 573 So. 2d 892, 904 (Fla. 2d DCA 1990), appeal dismissed, 629 So. 2d 134 (Fla. 1993); Hagerty v. Hagerty, 52 So. 2d 432, 434 (Fla. 1951). Rather, they serve mer......